Crypto Recovery Scams: How Fake Fund Recovery Companies Steal Twice

You lost money in a crypto scam. Then, a few days or months later, someone gets in touch with good news: they can get it back. They might call themselves a law firm, a "blockchain forensics" company, an "international fund recovery agency" or even a government department. All they need is a fee first.

This is a crypto recovery scam, also called a fund recovery scam or recovery room scam. It is the second punch after the first scam, and it is very common.

How big is the problem?

The FBI's 2025 Internet Crime Report recorded 10,516 recovery-scam complaints with about $1.4 billion in losses (these losses may include the money lost in the earlier scam). People aged 60 and over alone reported about $540 million. The FBI also noted a rise in complaints about criminals pretending to be government officials and recovery firms.

In the UK, the Financial Conduct Authority (FCA) warns that recovery rooms often follow investment scams, and that the original scammers may run the recovery room themselves or sell victims' details to other criminals.

How a crypto recovery scam works

1. They find you. Scammers buy and trade lists of people who have already been scammed. Some victims find the "recovery" firm themselves through online ads, fake reviews or social media posts that say "I got my crypto back".
2. They sound official. They may claim to work with the FBI, police, a regulator, or a made-up body. The FBI has warned about a fictitious "International Financial Trading Commission". They send documents with real-looking letterheads.
3. They know your details. They may know the exact amounts, dates and the platform you used. This feels convincing, but it often means they are linked to the people who scammed you.
4. They ask for money first. It may be called a retainer, legal fee, tax, "wallet verification", "anti-money-laundering deposit" or "bank activation fee".
5. The fees never end. After the first payment there is always another charge. Often they move you into a WhatsApp group or a fake "foreign bank" or crypto account that shows your "recovered" money, but you can never withdraw it.

Red flags of a fund recovery scam

• Unsolicited contact about money you lost, especially if you never reported it to them.
• Upfront fees before any money is returned.
• Payment in crypto, gift cards or wire transfer.
• Guarantees like "100% recovery" or "we have recovered millions for victims like you".
• Claims of government partnership. The FBI says there are no law firms that are officially authorised partners of US government agencies.
• Claims you are on a "government list of victims".
• "Hackers" who say they can reverse blockchain transactions or break into the scammer's wallet.
• Webmail addresses such as Gmail or Yahoo. The FCA says it never contacts consumers from webmail, and neither do government, police or real law firms.
• Refusal to meet on video or show a law licence or registration.
• Pressure and secrecy: "pay today or the funds will be returned to the state", or "don't tell your bank".

Can stolen crypto really be recovered?

Sometimes, but not in the way recovery scammers promise. Crypto transactions cannot simply be "reversed" by a hacker. Real recovery usually happens when:

• Law enforcement traces the funds to an exchange and the exchange freezes them.
• Authorities seize funds through a legal process, which can take months or years.
• You report quickly to the exchange you sent from, so it can flag the receiving wallet.

The US government does not ask for payment for law enforcement services. The FTC adds that real agencies will not ask for money or account details to help with a refund, and will not guarantee you will get your money back.

What to do if a "recovery company" contacts you

1. Do not pay anything. No fee, deposit, tax or "test transaction".
2. Do not share your ID, bank details, seed phrase, private keys, or give remote access to your device.
3. Verify independently. Look up the agency or regulator's official number yourself. In the UK, use the FCA Firm Checker and contact firms only through the details listed there. If someone says they are from the FBI, call your local FBI field office.
4. Search the name with words like "scam" or "complaint". Be careful: scammers post fake positive reviews too.
5. Save everything: emails, chat logs, documents, wallet addresses and payment records.
6. Report it (see below).

What to do if you already paid a recovery scammer

1. Stop all payments and stop replying.
2. Contact your bank, card issuer or crypto exchange immediately and ask for a recall or reversal.
3. If you shared passwords or allowed remote access, change passwords from a clean device and move any remaining crypto to a new wallet.
4. Report both the original scam and the recovery scam.
5. Expect more contact. Scammers may come back as a "new" agency. Treat every recovery offer with the same suspicion.

Where to report

Reporting to the real authorities is free. If an investigation leads to recovered funds, the official agency will contact you through official channels, and it will not ask you for a fee.

Why victims fall for recovery scams

Nobody falls for this because they are foolish. After a big loss, people feel desperate, ashamed and hopeful at the same time. Recovery scammers use that hope. They often sound kind and patient, and they "understand" what you went through.

If you have been scammed, talk to someone you trust before you reply to any recovery offer. A second opinion is the best protection. Our guide on what to do if you've been scammed has the full first-hour checklist.

Learn the original scams

Most crypto recovery scams follow one of these:

• Pig butchering scams, where a friendly online contact leads you into fake crypto investing.
• Fake crypto trading platforms that show huge profits you can never withdraw.
• Telegram task scams that pay small amounts before asking for bigger deposits.

Not sure about a message? Use our is-this-a-scam checklist or report it to us.