Austria uncovers $1.3 million in “crypto” fraud; Ledger is the target of a phishing scheme

Introduction:

In a case that mixes old-fashioned scams with modern technology, Austrian police have taken down a criminal network accused of stealing over $1.2 million in crypto assets and other valuables. This isn’t just another run-of-the-mill scam—it’s a new twist on an old trick, showing how criminals are keeping up with the times.

What Is Rip-Deal 2.0?

Vienna police have uncovered a scam they’re calling “Rip-Deal 2.0.” This scheme preyed on investors, most of them Austrians, and was orchestrated by a 39-year-old Dutch man with Serbian roots. The mastermind is already behind bars in Italy, serving a three-year sentence after being caught in a Europol-led sting earlier this year.

The scam itself is a modern version of Austria’s classic “Rip Deal.” Traditionally, this con involved using fake cash to buy high-value items like luxury watches, which were then sold for real money. The updated version replaces watches with digital assets—cryptocurrency bought with counterfeit cash.

How the Scam Played Out

For over three years, Austrian police tracked this criminal network. Victims were invited to fancy hotels in foreign countries, where deals were made to look legitimate. Payments were made in cryptocurrencies, but hidden cameras were often used to spy on victims’ phone screens as they entered wallet passwords or recovery phrases. Armed with these details, the scammers would empty the wallets.

One lucky escape involved an Austrian businessman who was about to lose $137,000. He had been tricked into transferring the money into a digital wallet as part of a fake industrial machinery purchase. Luckily, his daughter—a police officer—recognized the scam just in time and stopped him.

Cracking Down on Rip-Deal 2.0

According to Chief Inspector Gerald Goldnagl, who leads Vienna’s Rip-Deal task force, the team has solved over 100 similar cases since 2020, uncovering losses totaling $26.3 million. While these victories are significant, the battle isn’t over—scammers continue to adapt, making it a game of cat and mouse.

Ledger Users in the Crosshairs of Scammers

Meanwhile, another group of fraudsters is targeting Ledger users, ramping up their phishing efforts. Users of the popular hardware wallet have reported receiving emails that look like they’re from Ledger’s support team. These emails claim there’s been a data breach and encourage users to “verify” their recovery phrases using a special tool.

Of course, the tool redirects victims to a fake website. Once users enter their recovery phrases, the scammers use them to drain the wallets.

Ledger’s Advice to Users

Ledger responded quickly, reminding users that their devices are designed to be secure and that the company will never ask for recovery phrases via email, text, or phone. “If someone asks for your recovery phrase, it’s 100% a scam,” the company emphasized.

Phishing attempts like these are unfortunately nothing new for Ledger users. In fact, such scams have been on the rise since a 2020 data breach exposed the personal information of over a million Ledger customers, making them prime targets.

Crypto Scams Are Getting Smarter

The Austrian case is just one example of how crypto scams are evolving. According to Chainalysis, cybercriminals stole $1.58 billion in the first half of the year alone and raked in $460 million through ransomware attacks. A newer scam known as “pig butchering” is also gaining traction, where scammers build trust with victims over weeks or months before defrauding them.

As crypto becomes more mainstream, so do the risks. The key to staying safe? Stay informed, protect your recovery phrases, and always be cautious when dealing with your digital assets. A little vigilance can make all the difference in protecting your investments.

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