Crypto Scam Network Disrupted: Brooklyn Prosecutors and FBI Take Down 241 Websites and 112 Servers

By Kevin · 2026-10-16 · News

Oct. 16 (CandyPulse) — Behind every fake crypto investment site there is a machine: servers, domains and scripts that keep the scam running. This week, Brooklyn prosecutors and the FBI pulled the plug on one of those machines.

The Brooklyn District Attorney's Office and the FBI's New York field office said they had seized or disrupted 241 websites and 112 servers linked to a crypto fraud network that targeted Russian-speaking Americans.

Key takeaways

Authorities seized or disrupted 241 websites and 112 servers hosted in Eastern Europe and the U.S.
The scam targeted Russian-speaking Americans through Facebook ads and fake investment advisors
Victims lost tens of millions of dollars, some their life savings
Scammers then hit victims a second time, offering to "recover" the stolen money
No arrests yet; about $300,000 in stolen funds has been seized so far

How the scam worked

The fraud started with something ordinary: Facebook ads. Victims were drawn in by promises of crypto investment returns and guided by fake investment advisors.

Once the money was gone, the scammers came back. Data recovered from the seized servers showed they contacted victims a few weeks later, offering to help get the stolen funds back. It was another trap, designed to take even more money from people who had already lost.

Why the servers mattered

Taking down websites alone rarely stops scammers; they simply build new ones. That is why the 112 servers were the real target. Seizing them cut off the scammers' ability to create new sites and contact victims.

As Assistant District Attorney Alona Katz put it: "We disabled the back end of the operation."

Detail	What we know
Websites seized or disrupted	241
Servers seized	112, hosted in Eastern Europe and the U.S.
Victims	Russian-speaking Americans
Losses	Tens of millions of dollars
Funds seized so far	About $300,000
Arrests	None yet
Investigation	About three years

A long investigation

The Brooklyn DA's Virtual Currency Unit worked with the FBI to trace the network to Ukraine and neighbouring countries. The action capped a three-year investigation. Before this, the unit had already seized or disrupted 400 domains tied to crypto investment fraud.

How to protect yourself

Be wary of investment ads promising high crypto returns
Never trust "recovery" services that contact you after a loss; that is a common second scam
Check who you are dealing with before sending money
Report fraud to local police and, in the U.S., to the FBI

What's next

Prosecutors say they are still working to recover more stolen funds. With no arrests yet, the case is far from closed, but the scammers have lost the infrastructure that kept them in business.

Disclaimer: This article is for information only and is not financial advice. Crypto assets are volatile and can lose value. Always do your own research before making any investment decision.