First steps to recover funds from a crypto scam

Along with the growth of cryptocurrency popularity, cases of crypto scams have become more common. Previously we posted an article where we described how to store your crypto assets securely.

But what should you do if you've become a victim of a cryptocurrency scam and is it possible to refund your money? In this guide, we will describe the steps to take if you are a victim of crypto scammers.

Note! Of course, attempts should be made to return funds, but we draw your attention to the fact that the chances of a full refund are rather low due to the decentralized nature of cryptocurrencies.

1. Save the transaction ID of transferring funds to scammers

Blockchain stores the history of all cryptocurrency transactions, and transfers made in the course of fraud are no exception. 

how blockchain works

With the help of a blockchain explorer, you must find and save the ID of a fraudulent transaction in which your funds were stolen or fraudulently received; this will be the starting point for future investigations.

Crypto investigators are experienced in tracking down fraudulent transfers and unraveling attempts by fraudsters to cover their tracks.

2. Check your credit score and alert the credit agency

Often, as part of their schemes, scammers gain access to important personal information that they can use to open new fraudulent accounts on crypto exchanges and even banks.

As a result, it is wise to check your credit score and alert the credit agency to prevent the scammers from opening a new credit account in your name.

3. Document all information about interactions with scammers

It is important not to give in to emotions and collect as many documents and evidence of your interactions with scammers as possible. Collect the following data:

  • Codes of all your transactions to scammers in the blockchain;
  • If you bought cryptocurrency for fiat, you will need a bank statement confirming such a purchase;
  • A consistent description of the history of your interactions with scammers;
  • Learn how the scam started, how much currency you lost, what exchange services were used in the process, and all the dialogues in the chats of any messengers where you communicated with scammers. If you communicated via voice then write down all your dialogues with scammers from memory. If you have records of telephone conversations - save them, they will also be very useful.

4. Notify the cryptocurrency exchange

Cryptocurrency exchanges can't recognize scammers in advance, but they can counter their further actions. By notifying the cryptocurrency exchange of fraud, you prevent the scammers from continuing their activities. In addition, there is a chance that the managers of the cryptocurrency exchange will freeze the accounts of scammers for the duration of the investigation.

5. Report to Financial Law Enforcement

Report fraud to law enforcement in your area. It will be faster to contact the department working with financial crimes immediately. Give them all the information you have.

In addition, you can contact private investigative agencies specializing in blockchain fraud.

Additional Solutions

Hire private investigators specializing in crypto-fraud.

In such a case, you will not be limited by your local law enforcement agencies; rather private investigators have more experience, expertise, and developed methods for investigating crypto scams, which increases your chances of getting a refund.

Coordination with other scam victims

If you have become a victim of a mass scam involving social networks, you can try to contact other victims and together organize a class-action against persons or organizations involved in the scam.

Summing up

Investors should be skeptical of any investment opportunity that promises unusually high returns or makes unrealistic promises. They should also research the background and track record of the company or individual proposing the investment opportunity.

If you become a victim of a cryptocurrency scam, it is important to take these several steps to recover your money. 

Remember, always be skeptical and do your own research (DYOR) on all the information when investing in cryptocurrency.

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