U.S. regulators have cracked down on a large crypto scam that used social media and messaging apps to lure unsuspecting investors. The Securities and Exchange Commission (SEC) has charged seven entities for allegedly running a coordinated scheme that siphoned more than $14 million from retail investors across the United States.
According to the SEC, the operation wasn’t built around real crypto trading at all. Instead, it relied on trust-building tactics, fake platforms, and misleading promises designed to exploit people looking for investment opportunities online.
How the Scam Reached Victims
The scheme reportedly ran from early 2024 through January 2025 and began with targeted ads on popular social media platforms. These ads encouraged users to join exclusive “investment clubs” that promised education, AI-powered trading strategies, and consistent returns.
Once users joined, communication shifted to WhatsApp group chats. Inside these groups, scammers posed as experienced financial professionals, gradually building credibility and confidence. Members were shown polished messages and so-called AI-generated trading tips, creating the illusion that the group had access to advanced investment tools.
Fake Platforms and False Profits
As trust grew, victims were instructed to open accounts on what appeared to be legitimate crypto trading platforms named Morocoin, Berge, and Cirkor. The SEC says these platforms were completely fake. No real trading activity ever took place, despite claims that the services were licensed and government-approved.
To deepen the deception, the groups promoted bogus security token offerings linked to fictitious companies. Investors believed they were participating in early-stage crypto opportunities when, in reality, their money was simply being funneled away.
The Trap Tightens During Withdrawals
Problems surfaced when investors tried to withdraw their funds. Instead of processing withdrawals, the scammers demanded additional “fees” or charges, claiming they were required to unlock profits or complete transactions. These extra payments only increased investor losses, with no chance of recovery.
The SEC alleges that the stolen funds were moved overseas through a network of bank accounts and crypto wallets, making recovery even more difficult.
SEC Warns of a Growing Trend
The regulator described the case as a textbook example of an “investment confidence scam,” a tactic that is becoming increasingly common in the digital asset space. SEC officials emphasized that fraudsters are exploiting social media, private group chats, and the hype around AI and crypto to appear legitimate.
Alongside the charges, the SEC issued a fresh warning urging investors to be cautious of unsolicited investment advice, especially in messaging apps. The agency advises verifying anyone offering investment opportunities through official channels like Investor.gov.
The case serves as a reminder that if an investment opportunity relies heavily on private chats, guarantees quick profits, or asks for extra fees to access funds, it’s often a major red flag.
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FAQs
It’s a scam where fraudsters build trust over time using fake success stories and guidance, then persuade victims to invest on bogus platforms.
Rarely. Legitimate firms don’t rely on WhatsApp or Telegram groups for investments or pressure users with time-limited offers.
Guaranteed returns, no verifiable license, withdrawal fees, unclear ownership, and pressure to reinvest are strong warning signs.
Stop sending funds immediately, document all interactions, and report the case to regulators or cybercrime authorities promptly.
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