Brooklyn prosecutors and the FBI have dismantled a multinational cryptocurrency investment scheme that targeted Russian-speaking Americans, recovering $300,000 and seizing a vast network of fraudulent websites and servers. The action, revealed by District Attorney Eric Gonzalez, disrupted one of the most extensive cyber scams ever tackled by a local prosecutor’s office, though no arrests have been made so far.
Hundreds of fraud websites taken down
The Kings County District Attorney’s Office, in cooperation with the FBI, seized 241 fraudulent websites and 112 servers linked to the scam. Investigators executed search warrants across three time zones, focusing on servers hosted in the United States and Eastern Europe.
According to the DA’s Virtual Currency Unit (VCU), the criminal network leveraged cyber infrastructure, including IP addresses in Ukraine and several other Eastern European countries, to conduct the operation. Authorities stated that disabling these servers severed scammers’ access to essential data, victim records, and operational software. This not only dismantled their existing network but also made it significantly harder to establish new fraudulent sites or contact previous victims.
The VCU’s ongoing investigation, extending over three years, had previously dismantled around 400 scam websites. However, investigators noted that new fraudulent domains often surfaced rapidly to replace those taken down.
District Attorney Gonzalez reported that nearly $300,000 has been recovered so far, with efforts underway to track down additional funds siphoned through the fraudulent schemes.
Social media scams and sophisticated targeting
The scam leveraged social media to ensnare victims, primarily through Russian-language Facebook ads promoting fake crypto investment opportunities. Upon responding to such ads, victims received calls in Russian from individuals posing as investment advisors.
Targeted individuals were then guided to set up accounts on fraudulent crypto investment platforms. Victims purchased digital assets and transferred them to wallet addresses controlled by the scammers. For weeks or months, the platforms showed rising balances, giving the illusion of profitable investment.
Attempts to withdraw funds typically resulted in accounts being locked. Victims faced demands for additional payments, labeled as fees or taxes, before access would be “restored.”
Prosecutors emphasized that Brooklyn’s sizable Russian-speaking community made the borough particularly vulnerable, with numerous individuals losing their entire life savings in the scams. The District Attorney’s Office estimates aggregate losses run into the tens of millions of dollars.
Victims targeted twice by fraudsters
The investigation uncovered a secondary scheme: several weeks after the initial theft, the perpetrators contacted victims again, this time offering to recover lost funds in exchange for further payments.
“These criminals stole many millions of dollars from Russian-speaking victims through an elaborate investment scheme, then tried to exploit them again with false promises to recover their money,” said Eric Gonzalez.
James C. Barnacle, head of the FBI’s New York field office, commended the District Attorney’s swift response, while Gonzalez credited the assistance of security firms including Shadow Server, Coeus, and UltaHost.
FBI crime statistics revealed that Americans reported $11.4 billion in cryptocurrency-related fraud losses in 2025, a 22% rise over the previous year. The DA’s office emphasized its continued efforts to recover more funds beyond the approximately $300,000 seized so far.
Mini dictionary: Kings County District Attorney’s Office, also known as the Brooklyn DA’s Office, is responsible for prosecuting crimes and safeguarding residents in Brooklyn, New York. The agency’s Virtual Currency Unit specializes in investigating cryptocurrency-related offenses.
Related crackdown on crypto fraud
In another notable case, Ronald Spektor, a 23-year-old Brooklyn resident, was sentenced to up to 12 years in prison for impersonating customer support at Coinbase and stealing about $16 million from roughly 100 victims. This case highlights ongoing efforts by law enforcement to tackle sophisticated crypto investment fraud, which remains a growing threat to the public.
| Year | Crypto Fraud Losses (US) | Websites Seized (Brooklyn case) | Funds Recovered |
|---|---|---|---|
| 2025 | $11.4 billion | 241 | $300,000 |
