Federal Agents Seize $1.2 Million in Cryptocurrency from Elaborate ‘Wrong Number’ Investment Scam Targeting Victims Nationwide
PHOENIX, Ariz. — Federal law enforcement agencies have seized approximately $1.2 million in cryptocurrency linked to a sophisticated “wrong number” scam, part of a broader wave of crypto investment frauds devastating victims across the United States.[1][2]
The seizure, announced by the Department of Justice (DOJ) and involving the FBI’s Phoenix field office, targets proceeds from “pig butchering” schemes—elaborate cons where scammers pose as friendly strangers via random texts or social media to build trust before luring victims into fake cryptocurrency investments.[1] In this case, authorities recovered funds from six virtual currency accounts, authorized by judges in the District of Arizona, Central District of California, and District of Idaho.[1]
The ‘Wrong Number’ Deception Unraveled
These scams often begin innocuously: a scammer sends a text claiming a wrong number, sparking a conversation that evolves into a personal relationship. Over time, the fraudster introduces the victim to a seemingly lucrative crypto trading platform, encouraging deposits that appear to grow rapidly on a bogus app.[1][2]
A detailed complaint from a California resident illustrates the scheme’s ruthlessness. The victim, contacted online by someone named “Nisa Gacias (aka Champion),” was persuaded to invest $25,000 initially in ZC Exchange, followed by $100,000 more. His account purportedly ballooned to $1.2 million in Tether (USDT), a stablecoin pegged to the U.S. dollar.[2] When he attempted withdrawal, scammers demanded $187,000 in “taxes,” plus an $8,000 extension fee. Desperate, the victim refinanced his home and borrowed from family, paying over $400,000 more—yet the funds never materialized. Communication was limited to online chats with no live support, and websites like zcorg01.com and FTXbuy66.com were used as fronts.[2]
“Victims are persuaded to invest money. Once the money is sent to a fake investment app, the scammer vanishes, taking all the money with them, often resulting in significant losses.”[1]
Massive Federal Crackdown on Crypto Fraud
This $1.2 million seizure is a fraction of larger enforcement actions. Earlier in 2025, the DOJ and FBI Phoenix collaborated to seize a staggering $112 million from similar pig butchering and investment scams, aided by blockchain analytics firm TRM Labs.[1] The operation unwound a “commingled network of transactions” leading to cash-out points at exchanges, enabling victim restitution.
“While ever-evolving technology has allowed criminal actors to expand into the digital world… we are working diligently with our law enforcement and private sector partners to harness the power of technology to mitigate these risks,” stated Assistant U.S. Attorney Seth Goertz, lead prosecutor on the $112 million case.[1]
The efforts reflect heightened inter-agency coordination, including the FBI Phoenix, U.S. Attorney’s Offices, and the DOJ’s National Cryptocurrency Enforcement Team (NCET), Fraud Section, and Money Laundering and Asset Recovery Section (MLARS).[1] Arizona recently launched the Darknet Marketplace and Digital Currency Crimes Task Force with partners like Homeland Security Investigations, IRS-Criminal Investigations, DEA, and U.S. Postal Inspection Service to dismantle organizations using crypto for drug trafficking, money laundering, and more.[1]
Surging Losses and Crypto ATM Nightmares
Cryptocurrency scams are inflicting record damages. TRM Labs’ Illicit Ecosystem Report noted $9.04 billion sent to fraud schemes like pig butchering in 2022 alone, with losses escalating since.[1] The Federal Trade Commission reports fraud involving crypto ATMs skyrocketed from $12 million in 2020 to $114 million in 2023—a nearly tenfold increase—with FBI data indicating continued growth.[3]
Crypto ATMs have become scam hotspots. Victims, often coerced via extortion emails or fake tech support calls, deposit cash that converts to crypto sent to scammers. In one Iowa case, victim Cason lost thousands; despite police seizing the cash via warrant, Bitcoin Depot fought in court, arguing the victim authorized the transaction. Iowa’s Supreme Court sided with the company, as funds had been converted and transferred.[3]
| Year | Reported Losses | Change |
|---|---|---|
| 2020 | $12 million | – |
| 2023 | $114 million | ~10x increase |
Companies like Bitcoin Depot have clashed with police. In Centralia, Washington, after a $25,000 seizure, the firm demanded return of funds, citing terms of service, and pressured other departments by withholding refunds. They even mailed a U.S. Constitution copy to officers, mocking alleged 4th Amendment violations.[3] Iowa’s attorney general sued Bitcoin Depot, alleging over half of its Iowa intake—more than $7 million—was scam-related.[3]
Expert Warnings and Victim Protections
Investigators like Boise police Detective Brad Thorne note many agencies hesitate to pursue international scammers, succeeding in seizures rarely.[3] Commander John Altman of Woodbury, Minnesota police called ATM scams “running rampant all over our country.”[3]
The California Department of Financial Protection and Innovation (DFPI) flagged ZC Exchange as fraudulent, urging caution with unsolicited investment pitches.[2] Authorities recommend verifying platforms, avoiding random online financial advice, and reporting to the FBI’s Internet Crime Complaint Center (IC3).
These seizures signal aggressive federal pushback, but experts warn scammers adapt quickly. As crypto adoption grows, so do risks—emphasizing the need for vigilance in this digital Wild West.[1][3]
(Word count: 1028)