U.S. authorities are cracking down on crypto scammers by turning their own tactics against them. For the first time, the Federal Bureau of Investigation has disclosed that it created a cryptocurrency to bait and capture fraudsters.
The FBI claims the strategy worked, spurring market-manipulation and fraud charges against several crypto companies, including Gotbit, CLS Global, MyTrade, and ZM Quant, as well as 18 individuals. The agency says it seized more than $25 million in crypto, and several trading bots that were allegedly manipulating around 60 cryptocurrencies were shut down.
“What the FBI uncovered in this case is essentially a new twist to old-school financial crime,” said Jodi Cohen, the special agent in charge of the FBI’s Boston division.
As part of “Operation Token Mirrors,” the FBI created an Ethereum-based (ETH) cryptocurrency called NexFundAI Token to target fraudulent token developers, promoters, and market makers. The defendants allegedly lured investors with false claims and engaged in wash trading, a deceptive practice where trades are made to create the illusion of heightened market activity and demand. The manipulation inflated token prices, allowing the scammers to sell their holdings at artificially elevated prices. These market manipulators were unaware that the FBI created the token as part of the sting operation.
“This investigation, the first of its kind, identified numerous fraudsters in the cryptocurrency industry. Wash trading has long been outlawed in the financial markets, and cryptocurrency is no exception,” said Acting U.S. Attorney Joshua Levy. The news comes more than two years after the FBI announced the formation of a cryptocurrency unit within the agency.
The Securities & Exchange Commission has also filed civil complaints against Gotbit, CLS, ZM Quant, Saitama, and other companies, accusing them of securities law violations. NexFundAI token trading has been disabled, but its price was up by over 1,558% when fraudsters were active.
The Economic Offences Wing (EOW) CID police registered a case against a Chennai-based cryptocurrency investment firm and its director for defrauding investors by promising high monthly returns.
Investors claimed that TFT Block Chain Services Private Limited, operating under the name Tycoon Fintech, defrauded the public by collecting investments ranging from ₹20 crore to ₹30 crore.
Published – March 21, 2026 07:04 pm IST
The Fairfax Scam Jam unpacks two of the fastest‑growing threats: romance‑based investment schemes and cryptocurrency fraud. Scammers often initiate contact through friendly wrong‑number texts, dating apps, and social media, then spend weeks or months building trust. Once a relationship feels established, victims are encouraged to “invest” in cryptocurrency, gold, or foreign currency through fraudulent platforms operated by criminal organizations.
You’ll learn how these schemes operate step‑by‑step, the psychological tactics scammers use, and the financial and emotional devastation they leave behind. Presenters will share actionable tools for recognizing early warning signs, having preventative conversations with loved ones, reporting fraud, and recovering when possible. Whether you’re new to digital safety or a seasoned advocate, this year’s Scam Jam will give you the knowledge you need to stay a step ahead of scammers.
The 9th Annual Fairfax Scam Jam is a community collaboration between AARP Virginia and the Fairfax County Silver Shield Anti-Scam Program.
Resource Fair exhibitors will be on hand until 1 p.m.
Representatives from county, state and federal agencies will be available to answer your fraud and scam questions one-on-one.
Complimentary lunch is provided to registered guests.
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