Fake Lawyers and the Dangers of Money Recovery Scams for Desperate Scam Victims

When individuals fall victim to a scam, the emotional toll is immense, marked by shock, betrayal, and a deep desire to regain control, especially through recovering lost money. Unfortunately, scam victims, in their desperation to reverse the damage, are prime targets for yet another scheme: money recovery scams. These scams prey on individuals’ vulnerability, offering false promises to retrieve stolen funds.

What Are Money Recovery Scams?

Money recovery scams involve fraudsters pretending to offer services to help scam victims recover lost money. They often claim to be experts in fraud investigation, legal services, or government officials who can help victims retrieve funds lost in prior scams. Victims are approached via phone calls, emails, or even through online ads, offering assistance in exchange for a service fee or personal information.

These scammers take advantage of the intense emotions—desperation, shame, and guilt—that victims experience. In many cases, victims are more willing to take risky decisions in their efforts to reclaim what they lost, which makes them particularly susceptible to these secondary scams.

How Do Recovery Scams Work?

1. False Legal Representation: Scammers may impersonate law enforcement or legal experts, claiming to have tracked the original scammers and retrieved the stolen money. They might ask for legal fees or administrative costs upfront, promising reimbursement once the money is recovered.
2. Fake Recovery Agencies: Recovery scammers often pose as companies specializing in financial recovery, offering high success rates and pressuring victims to pay for their services. These fraudulent entities may even provide fake testimonials to lure victims.
3. Fake Law Firms and Attorneys: A newer and equally concerning trend involves scammers creating fake law firms and attorneys advertising on platforms like Facebook and other social media channels. These fraudsters promise high success rates in recovering stolen money, creating a false sense of credibility by using legal jargon and offering professional-looking websites. In reality, they are simply more scammers who ask for upfront payments disguised as legal fees or administrative costs and then disappear once the money is transferred.
4. Upfront Fees: Most recovery scams ask for upfront fees disguised as processing fees, transaction costs, or legal service charges. Once the fees are paid, victims often lose contact with the so-called recovery agents or are strung along with additional payment requests.
5. Personal Information Theft: Victims may also be tricked into providing sensitive personal and financial information, including bank details or Social Security numbers, which can lead to identity theft and further financial loss.

What the FBI Says

Cryptocurrency Recovery Services

The FBI warns of an increase in cryptocurrency recovery schemes, which exploit victims who lost cryptocurrency to fraud, scams, and theft. In 2022, victims reported losing more than $2.5 billion in cryptocurrency investment frauds1 alone, according to the FBI Internet Crime Complaint Center (IC3).

Representatives of fraudulent businesses claiming to provide cryptocurrency tracing and promising an ability to recover lost funds may contact victims directly on social media or messaging platforms. Victims may also encounter advertisements for fraudulent cryptocurrency recovery services in the comment sections of online news articles and videos about cryptocurrency; among online search results for cryptocurrency; or on social media.

Recovery scheme fraudsters charge an up-front fee and either cease communication with the victim after receiving an initial deposit or produce an incomplete or inaccurate tracing report and request additional fees to recover funds. Fraudsters may claim affiliation with law enforcement or legal services to appear legitimate.

Private sector recovery companies cannot issue seizure orders to recover cryptocurrency. Cryptocurrency exchanges only freeze accounts based on internal processes or in response to legal process. Victims can also choose to pursue civil litigation to seek recovery of their funds.

Fake Attorneys

Using social media or other messaging platforms, fraudsters posing as lawyers representing fictitious law firms may contact scam victims and offer their services, claiming to have the authorization to investigate fund recovery cases. To validate the contact, the “lawyers” claim they are working with, or have received information on, the scam victim’s case from the FBI, Consumer Financial Protection Bureau (CFPB), or other government agency. In some instances, scam victims have contacted fraudsters on fake websites, which appear legitimate, hoping to recover their funds.

To further the recovery scam, the “lawyers” may:

• Request victims verify their identities by providing personal identifying information or banking information to get their money back;
• Request victims provide a judgment amount they are seeking from the initial fraudster;
• Request victims pay a portion of initial fees up front with balance due when funds are recovered;
• Direct victims to make payments for back taxes and other fees to recover their funds; or
• Reference actual financial institutions and money exchanges, to build credibility and further their schemes.

Between February 2023 and February 2024, cryptocurrency scam victims who were further exploited by fictitious law firms reported losses totaling over $9.9 million, according to the FBI Internet Crime Complaint Center (IC3).

Why Scam Victims Are Vulnerable

Victims of fraud are emotionally and mentally drained. They often feel humiliated and are ashamed to admit their losses to friends or family, which can lead them to seek “easy” solutions like recovery services without proper investigation. Scammers prey on these emotions, providing hope when victims feel their situation is hopeless.

Additionally, many victims are unaware of the cyclical nature of scams, where criminals come back in different guises (such as a recovery agency) to target the same people they previously defrauded. The pressure to recover the money quickly often clouds their judgment, making them more likely to take another risky gamble on a fake recovery offer.

Red Flags of Money Recovery Scams

Victims can protect themselves by recognizing the warning signs of a recovery scam:

• Upfront Fees: Legitimate recovery services will not demand upfront fees or payment before services are rendered.
• Guaranteed Success: No recovery service can guarantee that lost money will be recovered. Claims of high success rates or guaranteed results are immediate red flags.
• Pressure to Act Quickly: Scammers may create a sense of urgency, suggesting that the victim must act immediately to get their money back.
• Unverified Companies or Agents: Always verify the authenticity of a recovery service. Fraudsters often create fake companies, websites, and reviews to appear legitimate.
• Lack of Transparency: Legitimate companies will provide a clear explanation of their processes, fees, and success rates without pressuring the victim for immediate payment or personal details.

Fake Lawyers

Recently, we have seen a burst of fake attorneys and law firms appearing on social media, such as Facebook. They are fairly easy to spot because of all the old red flags, such as bad design and grammar. They make extraordinary claims about how they can recover money fast with high degrees of success.

In many cases, they are using the real names and photos of legitimate licensed attorneys and law firsts so they can be verified, with all contact information pointing to the scammers.

Here are some examples – A Gallery of Fake Lawyers:

Note that these images were mostly stolen from real lawyers to make it difficult for potential victims to determine they are fake. Any copyrights are acknowledged.

How to Protect Yourself

• Research: If you are considering using a recovery service, research the company extensively. Check for reviews, testimonials, and legal credentials. Be cautious of overly positive reviews that seem generic or fake.
• Report to Authorities: Instead of turning to third-party recovery agents, victims should report the fraud to official organizations, such as the Federal Trade Commission (FTC), local law enforcement, or consumer protection agencies. Many countries also have official bodies that help with fraud-related complaints. Also, report to the state or province Bar Association that is responsible for licensing attorneys.
• Do Not Pay Upfront: Avoid any service asking for payment upfront. Most legitimate recovery services work on a contingency “no win, no fee” basis or receive payment only after successfully recovering the lost funds. Note that some legitimate firms do charge upfront fees, but they should be avoided regardless.
• Consult Financial Institutions: Notify your bank or financial institution immediately if you’ve been scammed. Banks may have fraud prevention departments that can provide assistance or block further fraudulent transactions.
• Seek Emotional Support: Victims may experience depression, guilt, or anxiety after a scam, making them more vulnerable to recovery scams. Reaching out to trusted friends, family, or professional counselors can help regain emotional stability and rational thinking before making further decisions.

Conclusion

Falling victim to a scam is devastating, and the emotional and financial impact can lead people to make rash decisions in a bid to recover their losses. Unfortunately, this desperation makes them prime targets for money recovery scams, which only worsen the damage. Scam victims should proceed with caution, avoid recovery agents asking for fees upfront, and report fraud directly to relevant authorities to avoid falling into a cycle of re-victimization. By recognizing the signs and maintaining vigilance, victims can protect themselves from further exploitation.