US Secret Service masks $400 million crypto fraud network

For the past decade, the US Secret Service’s Global Research Operations Center (GIOC) has quietly recovered nearly $400 million in digital assets from cybercriminals, emerging as a horrifying force in global crypto enforcement.

What starts as casual online chats can end up with economic destruction. In one case, the victim was seduced by a friendly stranger and led to a legitimate crypto investment platform with charts, sophisticated interfaces and responsive customer support. Initial sediments showed modest benefits. Encouraged, the victim sent more money and even borrowed it to catch up. The platform then darkened and the account balance disappeared.

“That’s how they do it,” Jamie Lamb, an investigative analyst with the US Secret Service, spoke to a Bermuda law enforcement officer last month. “They will send you photos of really good looking guys and girls. But it’s probably the old Russian man.”

The incident was just one of many analyzed during a weeklong workshop led by Secret Service’s Global Research Operations Centre (GIOC). Using open source tools, GIOC investigators have traced the scam back to the domain, crypto wallet, thanks to simple VPN glitches and exposed IP addresses.

GIOC quietly became one of the most powerful players in code enforcement. Over the past decade, the team has seized nearly $400 million on digital assets, according to people familiar with internal agency briefings. Many of them rank among the largest known government-controlled digital asset holders and are held in cold storage wallets.

Kali Smith leads the global driving force for exposing crypto crime and exposing countries under digital threat

Kali Smith, head of the Secret Service’s cryptocurrency strategy, is at the heart of this effort. Under her leadership, the agency trains law enforcement agencies and prosecutors in more than 60 countries, targeting jurisdictions vulnerable to exploitation through weak regulation or sales schemes.

“After just a week of training, sometimes you think, ‘Wow, I didn’t realize this was happening in our country,'” Smith said during a training session in Bermuda.

Known for its advanced crypto regulations, Bermuda hosted a recent workshop amid growing concern that digital asset-friendly policies could also attract bad actors.

Bermuda Governor Andrew Murdoch told reporters that technology and financial services are great for economic growth, but could also be misused. He points out, along with your interests, you need strong investigative skills to deal with abuse under the law.

In a session overlooking the Hamilton Port, Smith warned that fraud victims often mistakenly assume that Bitcoin is safe. “They think they’re safe using Bitcoin, but they’re not,” she said.

One realistic incident involved an Idaho teenager who was forced to pay hundreds of dollars after sending intimate photos online. The investigation revealed a network of transactions that were noted through another American teenager, leading to a crypto wallet that eventually processed around $4.1 million in 6,000 transactions. The wallet was linked to a Nigerian passport and the suspect was arrested in England and awaited extradition.

Crypto fraud promotes record losses as fraud becomes violent and global manhunt intensifies

Digital asset fraud is currently the biggest cause of US cybercrime losses. Americans lost $9.3 billion in cipher-related fraud schemes in 2024. Loss of Robbery and Fraud – more than half of the FBI’s total $16.6 billion. Older victims were hit hardest, with losses approaching $2.8 billion, many of which have become fraudulent investment sites.

In more extreme cases, digital theft escalated into real-world violence. In New York, two men were charged with torture and accessing a code wallet by inviting and tortureing a longtime friend. In Connecticut, six individuals have been accused of acquiring and acquiring the parents of teenage hackers who stole $245 million in Bitcoin in a failed ransom attempt.

The Secret Service often works with large cryptocurrency companies to track stolen money. Companies such as Coinbase and Tether are invaluable in their investigations by conducting wallet analysis and freezing accounts with suspected fraud. One of the biggest hauls was a $225 million USDT, linked to a wide range of romance investment scams.

The focus on tracing dirty money is part of a broader, decades-old mission now expanding into the digital world, with the New York Field Office targeting Bermuda playing a leading role in global cryptocurrency enforcement and training efforts.