Aleksey Madan never thought the day would come.
This week he received a $140,000 check in the mail from Massachusetts officials. That was the full amount Madan had lost after falling for a get-rich-quick crypto scam.
鈥淗ow would you feel if all your money was stolen and you never expected to get it back, then you did?鈥� said Madan, 69. 鈥淚t feels amazing. I鈥檓 overjoyed. And also in shock.鈥�
Those funds were among the hundreds of thousands of dollars鈥� worth of cryptocurrency Massachusetts authorities seized from a fraudulent operation that targeted Russian-speaking seniors online and, in some cases, stole their life savings.
The Massachusetts Attorney General鈥檚 Office began investigating the company, known as SpireBit, following last year detailing the stories of two victims who were lured into an investment scheme, only to realize it was a sham after they transferred large quantities of money into SpireBit鈥檚 cryptocurrency wallets.
SpireBit drew victims into its ruse by using ads on social media promising lucrative investment returns. SpireBit took out ads on Facebook and Instagram that falsely portrayed Elon Musk as endorsing the company through a Russian voice-over.
But NPR could find no trace of a real investment company: The people listed as the company鈥檚 executives turned out to be just stock photos and fake LinkedIn profiles. A supposed London address for SpireBit turned out to be a kitchenware business. When victims tried to withdraw their money, the company sent them forged bank documents. After NPR鈥檚 reporting, financial regulators in the United Kingdom about SpireBit, classifying it as an operation run by 鈥渇raudsters.鈥�
When NPR tried to reach out to SpireBit for comment last year, it responded through the Telegram messaging app by stating that crypto trading is volatile, and saying "the activities of our company are regulated according to the legislation of the country in which the head office of the company is located." Now, that account has been deleted.
NPR鈥檚 investigation caught the attention of Massachusetts authorities, who in December under its incorporated entity known as SBT Investments.
Investigators posed as a SpireBit customer and were able to pinpoint crypto wallets used by SpireBit. In , state officials won a court order that froze the company鈥檚 assets on the trading platform Binance.
While the full extent of SpireBit鈥檚 operation remains unknown, the company鈥檚 tactics are part of a proliferating type of online fraud known as pig butchering. The name comes from the process of gaining someone鈥檚 trust and building a friendship with them over the course of weeks or months 鈥� fattening up the pig before the kill, which in this case means stealing a large sum of money.
According to the FBI, crypto scammers from Americans online last year.
Investigators in Massachusetts were able to seize a total of $269,000 from SpireBit鈥檚 crypto wallet, most of which is being distributed to four victims in the state, .
Another SpireBit victim profiled by NPR, Naum Lantsman, 75, of Los Angeles, lost his life savings of $340,000 that he earned over decades as a small business owner. His family reported the theft to the California Attorney General鈥檚 Office, but a formal investigation was never initiated.
Officials from the Massachusetts and California attorney general offices did not return interview requests.
Copyright 2024 NPR
