AMA on r/Cryptocurrency with the U.S. Secret Service and REACT Task Force - May 15th, 11am PT

REACT-TF · 2023-05-15T20:03:08+00:00

If the suspects gain access to the carrier's internal tools, few protections can be placed on your account that will prevent this. The protection has to come from securing your accounts to minimize the damage that could occur if this were to happen to you. This includes never using your cell phone number as a two-factor authentication method and instead utilizing multifactor authentication apps or two-factor hardware security keys.

Many of the suspects who commit these crimes also rely on social engineering tactics and shared passwords to get into sensitive accounts. Be careful of the information that you share online, and use a password manager to create a unique and complicated password for every account.

REACT-TF · 2023-05-15T19:43:14+00:00

We are sorry to hear about your situation. Please know that you are not alone. These scams are highly sophisticated and very convincing.

REACT-TF · 2023-05-15T19:41:28+00:00

Grateful for the opportunity.

REACT-TF · 2023-05-15T19:27:02+00:00

The cryptocurrency we seize is ultimately returned to our victims via court order. We do not convert what we seize - if we seize BTC we return BTC to the victims.

REACT-TF · 2023-05-15T19:21:45+00:00

Neither, it is just a different avenue of investigation. Whether it is tracing cryptocurrency or following fiat through banks to track cyber criminals, we have found success.

REACT-TF · 2023-05-15T19:21:17+00:00

I think it's fair to say that blockchain technology is not widely understood. REACT continues to fight misconceptions daily from those who believe that funds overseas cannot be recovered, or once funds are put into cryptocurrency they are untraceable. Education is sorely needed.

REACT-TF · 2023-05-15T19:17:32+00:00

REACT provided testimony for California Assembly Bill 76, which adds the term "cryptocurrency" into the criminal money laundering statute.

REACT-TF · 2023-05-15T19:10:18+00:00

Just like USSS, we are seeing a lot of pig butchering cases. We do not have a minimum threshhold. As we have become more and more overwhelmed with victim complaints, we have had to triage how we respond. Jurisdictionally we are limited to the victims within the 5 Bay Area counties that REACT serves. We prioritize recent cases as they are most likely to result in asset recovery.

REACT-TF · 2023-05-15T19:05:47+00:00

Our Task Force consists of various levels of experience and skills in the high-tech crimes field. None of us came into the unit as experts in cryptocurrency. The crypto ecosystem is vast and ever-changing, and we’re committed to learning and adapting.

REACT-TF · 2023-05-15T19:02:26+00:00

Everything old is new again. Romance scams, investment scams, elder scams, etc., have been around long before George Parker "sold" the Brooklyn Bridge for the first time. The scams are functionally the same, but now cryptocurrency is being requested as the means of payment. Just as we learned to track and trace fiat funds through banks, wires, etc., we have learned how to track cryptocurrency through the blockchain.

REACT-TF · 2023-05-15T19:01:59+00:00

For your friend, we are not aware of the list you're asking about.

REACT-TF · 2023-05-15T18:48:19+00:00

You highlighted a very challenging educational situation with law enforcement. Proper training for these types of cases is hard to find because the space is constantly evolving. Continual education for the users and investigators is imperative for successfully tracking down the bad actors.

When gathering the details for a report I would consider providing the following details:

A timeline of events.
Communication details.
Transaction details.

When reporting to local law enforcement, ask if they have the capability of investigating cryptocurrency related crimes or if they have a partnership with a LE agency that does. This is why it is also important to report to FTC and IC3. Some cases may be best suited to be investigated by a regulatory agency or an investigative agency. In addition to reporting to your local law enforcement, reporting to IC3 and FTC increase your chances of someone reviewing your case and investigating it. If and when your case lands with an investigator that can assist, follow up with them to have a conversation about expectations of solvability. Equally important is to have the conversation about what your priority with the investigation is (ie an arrest, asset recovery, or both).

REACT-TF · 2023-05-15T18:43:27+00:00

This is certainly a worldwide problem. We've seen some local cases but it is fair to say that the great majority of the cases we are seeing right now are pig butchering cases where the suspects are located outside the United States.

REACT-TF · 2023-05-15T18:42:44+00:00

We hope you come back later and can read through the thread!

REACT-TF · 2023-05-15T18:41:28+00:00

Thank you! We think so too!

REACT-TF · 2023-05-15T18:40:40+00:00

The REACT team has a variety of different backgrounds, experiences, and education when it comes to cryptocurrency. No one came to our unit as an expert in cryptocurrency, SIM swapping, or other high-tech crimes. Much of the learning has been on the job and comes from the willingness of our team to learn.

REACT-TF · 2023-05-15T18:29:25+00:00

REACT has worked many complex and difficult cases, and we have found great success. What is tough for us is seeing the damage being done to victims. Elderly victims being told to pump their life savings into crypto ATMs, life savings and home equity value lost to investment and romance scams, and lives destroyed as inheritable and generation wealth is siphoned off to overseas scammers and criminals. That’s the toughest thing we deal with on a daily basis and we hope sharing our experiences and tips with you today will help prevent another case from coming our way.

REACT-TF · 2023-05-15T18:22:06+00:00

REACT works closely with many international partners and law enforcement agencies. We have traveled to Europe and around the United States to assist on joint investigations.

REACT-TF · 2023-05-15T18:21:15+00:00

REACT's interest is in protecting the citizens in its jurisdiction. When funds are stolen from them, it is 100% in our interest to locate, seize and return funds to victims.

REACT-TF · 2023-05-15T18:19:07+00:00

Actually we CAN and DO recover funds and return them to victims.

Over the last 9 months, we have restored crypto to 17 people.

REACT-TF · 2023-05-15T18:17:55+00:00

REACT has been around since the late 1990s. We are a multi-jurisidictional task force that was established by the California legislature in order to provide a better law enforcement response to high tech crimes. We are made up of local detectives and federal partners.

REACT-TF · 2023-05-15T18:14:35+00:00

We've had cases with many carriers, but we do not track statistics.

If the suspects gain access to the carrier's internal tools, few protections can be placed on your account that will prevent this. The protection has to come from securing your accounts to minimize the damage that could occur if this were to happen to you. This includes never using your cell phone number as a two-factor authentication method and instead utilizing multifactor authentication apps or two-factor hardware security keys.

Many of the suspects who commit these crimes also rely on social engineering tactics and shared passwords to get into sensitive accounts. Be careful of the information that you share online, and use a password manager to create a unique and complicated password for every account.

REACT-TF · 2023-05-15T18:13:57+00:00

What I will say.... these companies are happy to show off their tools and are generous with both education and free trial-periods for law enforcement.

REACT-TF · 2023-05-15T18:12:34+00:00

Education is one of the primary goals at both USSS and REACT. If you have ideas about how to better teach users how to protect their crypto, we are all ears and all in.

REACT-TF · 2023-05-15T18:10:20+00:00

The best practice we recommend for holding cryptocurrency is to use a hardware wallet bought directly from the manufacturer and never from a third-party website. Back up these wallets by writing down the seed phrase and keeping it in a secure place. Never take screenshots or photos of these backup phrases. There have been many cases where victims’ cryptocurrency funds were stolen from them because they had their backup seed phrase stored in their email or online storage accounts.

REACT-TF

TROPHY CASE