A bad actor conned a Minnesota resident out of $9.2 million over 21 transactions in an elaborate crypto scam. At the time, the victim believed he was sending a potential lover funds for cryptocurrency investments.
An Eden Prairie police detective has filed a search warrant affidavit in Hennepin County District Court to investigate the disappearance of a couple’s money. From December 21, 2022, to June 8, 2023, the reputed victim willingly sent $9.2 million to a mystery woman. Towards the end of this period, individual transactions ranged from $100,000 to $2.1 million, according to a StarTribune report.
Minnesota Prosecutors Had Never Seen Crypto Fraud So Massive
This latest swindle comes at one of the worst times imaginable for the crypto industry. It fights for its credibility amid heated rhetoric from the likes of Securities and Exchange Commission head Gary Gensler. In a recent interview, Gensler said that the industry is “rife with fraud, rife with hucksters.” Cases like this one do not help prove him wrong.
The scam began the way all too many investment swindles do. The alleged con woman enticed the victim on LinkedIn, promising high returns from crypto investments while developing a bogus romantic relationship.
Eventually, she pleaded with the victim to leave his wife. The offer of love and riches apparently proved too much of a temptation.
Without his partner knowing, the victim siphoned off the couple’s savings into what he believed was a venture called “Coinrule-web3.” After seeing a quick profit in this investment, the victim continued to send cash to the perpetrator. However, in a cruel twist, the scammer told him to pay a $2.8 million fee to receive his profits.
Learn how to keep your digital assets safe with this helpful guide: 15 Most Common Crypto Scams To Look Out For
The fraud came to the attention of the police on June 15 when the man’s wife told them he had been selling off their investment accounts over the past six months. At this point, the husband reportedly panicked and asked her to withdraw all their remaining assets to pay the $2.8 million fee to access his profits.
With a quick online search, police discovered that “Coinrule-web3” had ties to numerous other crypto and relationship scams.
“No one in the office has heard of a crypto fraud case as big,” John Stiles, spokesman for Minnesota Attorney General Keith Ellison, told the StarTribune. “In fact, their eyes popped when I told them the amount.”
The Latest “Pig Butchering” Scam
The case is the latest example of what’s known as a “pig butchering” scam. A type of longer-term fraud whose victims have drawn comparisons to pigs in an abattoir.
These scams involve manipulative relationships where criminals insert themselves into the victims’ lives. Only when the “pig” is fat enough, do they execute the scam. In this case, the mystery woman stayed in contact for a six-month period and walked away with a sizable prize.
Criminals in pig butchering scams often use crypto as a way of tricking victims out of their money. Relatively few understand the complexities of the technology, allowing the scammer to work from a position of authority. Highly publicized market surges have led many to believe they can get rich quickly.
The FBI has previously warned of crypto scammers operating on LinkedIn. The social media company’s director of trust, privacy, and equity, Oscar Rodriguez, has confirmed the recent increase in fraud on its platform to CNBC.
Minnesota authorities have said they will not be commenting further on the case.
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