What to do if You Are a Victim of a Crypto Scam or Theft

The rise of virtual assets like bitcoin has led to an increase in crypto scams. Criminals are always on the lookout for areas with lots of money. It's like a game of whack-a-mole – whenever we think we've got one scam under control, another one pops up. This can make it very challenging for people to detect and avoid scams. As per the Federal Trade Commission, cryptocurrency fraud resulted in reported losses of approximately $700 million last year.

Recovering stolen cryptocurrency can be difficult due to the regulations governing the space and the lack of expertise in handling crypto financial fraud. In these types of situations, it may be necessary to seek the assistance of a trustworthy crypto investigator who can work with law enforcement agencies to attempt to recover stolen funds. That being said, it is crucial to be wary of recovery scams who guarantee that they can rover your funds .

If you have been the target of a crypto scam or theft, here are three essential steps you should take:

Step 1: Write your narrative of what happened and gather supportive evidence

Presenting a well-crafted and concise narrative of the incident can enhance the quality of your case, enabling investigators to understand the flow of funds better. To ensure a thorough and accurate representation, it's important to incorporate essential details in your account, such as:

• Relevant transaction IDs (This can be found at the Exchange or Crypto wallet you use)

• Wallet address you sent crypto from

• Where you sent funds to (This could be the criminal/scammers wallet address)

• Screenshots of fraudulent communication (emails, texts, telegram messages, Twitter posts, etc.)

• Any other details you feel would be necessary to share

• Details on where the funds you sent currently reside. This is where Token Trace comes in - we can assist you in obtaining this information based on the details you've provided. By doing so, you can provide law enforcement with a clearer understanding of the situation, which can aid in determining possible courses of action, or if the potential for recovery is possible.
  

All of the above information will be helpful in Step 3

Step 2: Proof of ownership information

Law enforcement typically requires evidence to establish ownership of the initial source of funds. Ensure you retain access to the accounts used to transfer funds to the criminals/scammers.

If you are using a noncustodial wallet, make sure you retain your 12-word phrase or private keys.

Step 3: Filing reports to the appropriate agencies/ law enforcement organizations

It is best to file the reports in the following order. Please keep in mind these sites only apply to the United States.

1. FBI - Internet Crime Complaint Center (IC3): IC3 File a Complaint

2. File a report with your local law enforcement

3. Notify your local secret service field office: Field Office Contact

4. File a report with the Federal Trade Commission: Report Fraud

5. (Optional) If the scam or theft is related to securities fraud, please report it to the SEC: Report Securities Fraud
   

Is it guaranteed I will get my funds back?

The process of recovering lost funds can be arduous and time-consuming, and there is no guarantee of success. Unfortunately, in many cases, individuals may never recover their lost cryptocurrency.

Nonetheless, reporting the scam or theft to your federal government increases the likelihood of recovering your assets if a more extensive investigation is initiated.

The probability of a successful recovery depends on several factors, such as the amount lost, the techniques used to conceal the funds, and whether the funds have been transferred to a regulated exchange. If the funds are transferred to a regulated crypto exchange, it does increase the chances that law enforcement could recover the funds.

Token Trace is dedicated to providing the necessary information for reporting your crypto scam or theft. We will do our best to give you the support and guidance needed.