Our client lost close to £100,000 after being drawn into a sophisticated cryptocurrency investment fraud through WhatsApp. Following an initial recovery that represented only a small proportion of the loss, WRS escalated the matter and ultimately secured the recovery of the majority of our client’s money.
Key Takeaways
1. Casual social media conversations can be the starting point of sophisticated fraud
Fraudsters often begin with friendly, everyday conversation before gradually steering victims towards investment. The personal rapport they create is designed to lower suspicion and build trust.
2. Tiered bonus structures and VIP levels are common warning signs
Fraudulent platforms may incentivise increasingly large deposits through escalating reward tiers, bonuses and supposed VIP programmes. These structures are designed to encourage victims to commit more money.
3. Fabricated fees and penalties are frequently used to prevent withdrawals
When victims attempt to access their funds, scammers may introduce verification fees, transaction charges, tax demands, regulatory penalties or other supposed requirements designed to extract further payments.
4. A limited initial recovery does not necessarily have to be the final outcome
Where an institution offers only a small settlement, further escalation and stronger arguments may lead to a significantly improved result. In this case, our client ultimately recovered the majority of their losses.
At a glance
Scam type
Cryptocurrency investment fraud
Initial loss
Close to £100,000
Total amount recovered
Majority of losses
The challenge
Our client was contacted through WhatsApp by an individual who initially built a personal rapport before introducing what appeared to be a legitimate cryptocurrency investment opportunity.
Over approximately two months, our client was encouraged to make increasingly large deposits through payments processed via Monzo Bank. The scheme used a professional-looking trading platform, apparent cryptocurrency returns, tiered VIP bonuses and responsive “customer service” to create the impression of legitimacy.
When our client attempted to withdraw their funds, the fraudsters introduced a series of supposed fees, penalties and regulatory requirements. These included verification charges, transaction fees, tax demands and further deposits supposedly required before the account could be released.
Our strategy
WRS pursued the matter on our client’s behalf, advancing arguments concerning the circumstances of the fraud and the liability of the relevant institution.
The initial claim resulted in only a limited recovery. WRS did not consider that outcome satisfactory and continued to pursue the matter, escalating the case and developing the arguments further.
Following further consideration, a subsequent decision was made in our client’s favour, resulting in a substantially increased refund and the recovery of the majority of our client’s losses.
Think you have a claim?
Contact WRS for a free, confidential assessment — no obligation, no charge.
How the fraud began
Our client was contacted through WhatsApp by an individual who claimed to be visiting London from Singapore.
The early exchanges were social and light-hearted, helping to establish familiarity and trust. Before long, the conversation shifted towards investment, with the individual claiming to be generating substantial returns through cryptocurrency trading and encouraging our client to participate.
Our client was introduced to a trading platform offering tiered VIP bonuses linked to the amount of money deposited. The platform appeared professional and displayed what looked like live market information, account balances and detailed analytics.
A responsive “customer service” team also answered questions and guided our client through the trading process, further reinforcing the impression that the operation was genuine.
As confidence in the platform increased, our client was encouraged to make progressively larger deposits.
When the client tried to withdraw their funds
The position changed when our client attempted to withdraw their money.
Their account was suspended following allegations of collusion and misuse of promotional bonuses. Reinstatement was said to depend on making further deposits.
Additional demands then followed. Our client was told that a verification fee had to be paid, followed by a gas fee for transaction processing and a purported tax liability. Further regulatory explanations were also introduced, including claims that the account would be closed unless additional penalties were settled.
Each new obstacle required another payment before the funds could supposedly be released.
It eventually became clear that the fees and penalties were fabricated and that the platform was part of a coordinated fraud.
Our initial complaint
WRS pursued the matter on our client’s behalf, setting out our position regarding the circumstances of the fraud and the responsibility of the relevant institution.
Following correspondence and consideration of the complaint, an initial recovery was agreed.
However, the amount represented only a relatively small proportion of our client’s total losses.
Further engagement was subsequently refused, so WRS escalated the matter.
Escalation and recovery
WRS continued to challenge the outcome, presenting further evidence and developing the arguments supporting our client’s position.
The escalation resulted in a different decision being reached and a further refund being directed.
The additional recovery substantially improved the overall outcome and ultimately resulted in our client receiving the majority of their money back.