Blockchain Analytics Firm Chainalysis Shares Insights on Tracking On-Chain Activities of Suspected FTC Impersonators

The Federal Trade Commission (FTC) recently issued a key notice, warning consumers of scammers impersonating FTC staff members in “attempts to steal money from innocent victims.” Blockchain firm Chainalysis has analyzed these developments in a comprehensive update.

According to the FTC, these scammers typically “fabricate urgent financial scenarios and threaten consumers, and some have even referred victims to Bitcoin ATMs.”

In one instance, FTC impersonators stole “approximately $2 million from a woman after warning her that her social security number was compromised and even fabricating a letter from the FTC, stating that her accounts were under investigation.”

Unfortunately, impersonation scams “are on the rise — losses reported to the FTC in 2023 were more than $1 billion.”

Although most of these impersonators operate using fiat currency, they are increasingly turning “to cryptocurrency due to its increased adoption by the consumer population.”

As Chainalysis discussed in our 2024 Crypto Crime Report, they estimate “that the amount of crypto stolen by impersonators and tax authority scams was approximately $24 million in 2023.”

In 2024, Chainalysis estimate that “the total amount stolen is nearly $17 million as of April 2024.”

In recent update, Chainalysis look “at on-chain activity of suspected FTC impersonators and illustrate how we examined the potential scale of these scams after acquiring a few scammer addresses from victims.”

Their on-chain analysis of this suspicious activity “began when a victim of an FTC impersonator provided us with the impersonator’s crypto address.”

After successfully acquiring funds from the victim, the operator of this address “made several transfers to exchange deposit addresses, which likely represent the cash-out points.”

Once Chainalysis identified the exchange deposit addresses, they were able “to look at their receiving exposure, which revealed nearly 40 addresses that behave similarly to the one originally reported by the victim.”

Given that these addresses have sent funds to the same four exchange deposit addresses, it is likely that they “belong to the same scam group sharing crypto wallets or are working with the same money launderer.”

In total, these addresses represent “approximately $1.7 million worth of potential scam activity, illustrating that these losses can be significant, as the real FTC reported.”

Another factor Chainalysis examined to determine “the likelihood of these addresses belonging to FTC impersonators or a larger scam group is that they received funds from crypto ATMs, which the real FTC identified as a strategy to attract victims.”

As noted in the extensive update, Chainalysis see “how another address reported to us as an FTC scammer received funds from several crypto ATMs.”

Unfortunately, scammers like the ones above “not only approach victims by impersonating organizations, but often prey on victims who have already lost money by creating fake “asset recovery” websites to steal even more money.”

One example of this is a report Chainalysis “received regarding a website that appears to be a submission form created by more FTC impersonators who encourage victims to report scams.”

The operators of this site likely follow up with victims to trick them into paying more money to “recover their original assets.”

The reported address has received payments from “both a crypto ATM and exchanges.”

As the FTC stated in its press release, it “will never send consumers to a Bitcoin ATM, tell them to go buy gold bars, or demand they withdraw cash and take it to someone in person. It will also never contact consumers to demand money, threaten to arrest or deport them, or promise a prize.”

Additionally, the FTC implemented its Impersonation Rule “on April 1, 2024, outlining the most common impersonation scams and granting the agency more effective tools to deter scammers.”

Consumers who come across this suspicious activity or who “have been scammed can report it to relevant authorities like the FTC.”

Chainalysis hope to help combat these crypto-related scams by “providing law enforcement with the best on-chain data and solutions to investigate and bring scammers to justice.”


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