New York attorney-general to serve suspected crypto fraudsters with NFTs

As part of a fraud probe, New York attorney-general Letitia James will send suspected offenders notice of the proceedings in the form of an NFT.

According to investigators, from January to June 2024 a group of scammers sent US residents messages offering remote jobs on behalf of real companies. The “work” consisted of writing online reviews of various products, supposedly to generate “market data” for subsequent sale.

Before starting, applicants were required to register on a number of legitimate cryptocurrency platforms and buy USDT or USDC stablecoins in amounts equal to or greater than the price of the products they reviewed. Those funds were then routed to wallets controlled by the scheme’s organisers.

Victims were assured that the balances in their accounts would help “legitimise” the data they generated and were promised repayment of their initial transfers plus an additional fee.

When victims tried to withdraw funds, they were told to pay additional fees; even then, withdrawals were blocked.

One victim sent the perpetrators more than $300,000, another over $100,000. Aggregate losses totalled $2.2m.

The authorities were assisted by Tether and Circle, thanks to which the funds in the suspects’ wallets were frozen.

Attorney-general James has filed a suit to recover the stolen cryptocurrency. In addition, the regulator will bring charges against the suspected offenders by sending NFTs to their wallets with a link to a site containing all court documents in the case.

In June 2024, the New York attorney-general’s office filed a lawsuit against NovaTechFx and AWS Mining, alleging fraud and the deception of more than 11,000 investors for $1bn.