Cybertrace’s expert analysts are issuing an urgent alert about a dangerous new cryptocurrency scam technique: mirror transaction fraud. Fraudsters using this method dupe victims into transferring Bitcoin or other crypto in the mistaken belief it will validate a movement of funds in the opposite direction. As such, it represents a 21st century crypto iteration of well-known advance fee frauds, such as the Nigerian prince scam. By using highly technical language, mirror transaction fraudsters seek to convince their targets they have to transfer Bitcoin into another wallet to “validate” it and “unlock” their funds. Let’s look at how this technique works in detail, so you can better protect yourself and your family. But first: what’s the difference between mirror transactions and mirror trading?
Mirror trading vs mirror transactions
Mirror trading has made a lot of headlines in recent times. Originally a legitimate strategy for newbie forex investors to copy successful traders, it has since been associated with money-laundering. Last year, investigators named South African-based firm Mirror Trading International as 2020’s biggest cryptocurrency scam. Mirror transaction fraud, as discussed in this article, is a slightly different but equally dangerous beast. It describes a technique used by all kinds of scammers to trick victims into believing that, to receive any funds they are owed, they must first send an equal amount of money to another Bitcoin wallet to “validate” it. Needless to say, there are no other funds, and the transferred money simply disappears!
Making contact
We know from victims that mirror transaction fraud reaches them in a variety of ways. Having harvested their personal information elsewhere, scammers might email, text, call or contact them via social media. However, scammers ultimately want to get their targets on the phone in order to use their highly convincing sales tactics. In doing so, they present victims with a tempting opportunity to access a substantial amount of money. This could be money victims have themselves invested, “long-lost” Bitcoin accounts or unexpected windfalls such as lottery wins. For some unexplained reason, the fraudsters are unable to transfer these funds via bank transfer and have to use cryptocurrencies. The scammers appear convincing and persuasive, and pretend to represent an investment firm, forex broker, financial regulator or blockchain representative.
Mirroring transactions
Once they have them interested, scammers work hard to gain victims’ trust, often over the course of several phone calls. Having piqued their curiosity about what might unexpectedly lie in store, mirror transaction fraud then turns up the technical language. Using the jargon of mirror trading, they introduce related computing terminology, often with direct reference to IBM’s mirror method. While this certainly exists, it actually relates to IBM’s Customer Information Control System (CICS) and its distributed program link. While there is some interesting potential for how this could be used to eventually link real-world assets to the blockchain, it does not relate to validating individual Bitcoin transactions between different wallet addresses.
Scamming victims
The mirror transaction fraudsters’ aim is plain and simple: they seek to bamboozle victims into believing there is a technical requirement for them to “mirror” the supposed transaction before they can access their funds. In practice, this means asking victims to first send the same amount of money they are eventually due to receive. This is nonsense: anyone can receive Bitcoin into their wallet without first needing to send their own funds! However, scammers use the blockchain’s transparency to deceive their targets by showing them their funds just “sitting” in a wallet. All victims supposedly need to do is “validate” and “unlock” it by sending an identical amount to the same wallet. Unfortunately, hoodwinked victims believe the scammers and send the requested amount, expecting to receive twice as much back in return. It’s only when the promised windfall fails to materialise that they realise that the scammers have duped them.
History of similar scams
Mirror transaction fraud is merely the latest, 21st-century version of a long line of similar advance fee scams. Reaching back to the 18th-century Spanish prisoner fraud, its most prominent exponent is probably the Nigerian prince scam. Referring to the relevant fraud section in the Nigerian criminal code, it also goes by the name 419 scam. It refers to any fraud that elicits upfront money or financial information in return for a supposed windfall gain. These days, “Nigerian” scams actually emanate from many different countries, but the iconic moniker has stuck. While the means may have changed from bank transfers to Bitcoin wallets, the ends remain the same. Scammers seek to gain your confidence, exploit your trust, take your money, and leave you broke!
What can I do about mirror transaction fraud?
If the mirror transaction fraud hasn’t gotten you yet, beware of any unsolicited contact regarding unexpected windfalls. Remind yourself of the old adage: if it sounds too good to be true, it probably is! Also, remember to never transfer Bitcoin to another wallet if you are actually meant to receive it. Finally, ask people contacting you to put any information in writing, no matter how convincing they sound on the phone.
If, on the other hand, you have already fallen victim to mirror transaction fraud, don’t despair! Reach out to Cybertrace’s experienced investigators today to find out how we can help. Despite urban myths to the contrary, cryptocurrencies are eminently traceable and Cybertrace is the Australian pioneer in the field. Finally, please help keep our community safe by sharing this article widely and communicating your experiences in the comments below.
In August 2020 CV Markets claimed to be offering training on crypto. Initially I transferred BTC, value at the time $500. They did their number on me and sent about $130 back to my Coinspot account.
The next move was I was assisted to buy BTC with my credit card. This $2000 of BTC was transferred to them.
In their site my account looked like it was growing. I was suspicious because they kept wanting more BTC.
I tried to withdraw supposed profit. A very tedious process. Unsuccessful, the withdrawal never got beyond ‘pending’
Time went by, and the phone calls began again. This time they were closing their private client section down so they needed to return the balance of my account.
They have tried 3 times now, the latest attempt was last evening. They first claimed the funds would go to my bank account. This though wasn’t possible. My bank accounts are very small!
They then had a look at a crypto exchange account. Had a good look, this account has zero. That too was no good.
Then they tried Coinspot, the account they had originally been paid from.
I have not upgraded my KYC so this too was not possible. They wanted to get on to Coinspot then an there and sort the problem. That’s how they stole the $2000 August 2020. The original $500 I was prepared to invest for a learning experience.
I wasn’t learning anything. I was being confused.
The purpose of all this is to advise that CV Markets UK are still scamming. I was initially hopeful they were going to repay what they received. But their tactic is this ‘mirroring ‘ I not giving them anything. I will contact Coinspot and advise them also.
Thank you
Thanks for the feedback and helping to warn others, Sue. These scammers are highly persuasive and run a sophisticated operation. Your approach of not giving them any more money, even if supposedly needed to get back your original funds, is definitely the way to go. They are just looking for opportunities for further rip-offs.
Thank you for the information, because, Lyon Assets UK wanted to use mirrors transaction to refund me my money that they scammed from me.
I too are a victim of crypto scam. I lost $20000 and almost another $16400. Once I figured out it was a scam over the weekend I managed to send the $16400 back into my account. Come Monday phone call and she wanted to transfer the $16400 over to MetaTrader but I said I transferred it back as I had a car accident and wrote my car off.
I said I need the $20000 back to pay for the other car in which she agreed but still got me to go to Binance first to transfer the $16400 over to MetaTrader then transfer the whole amount back to me.
Once she found I had already transferred it back she told me go to MetaTrader and then she said ok they haven’t closed it yet I will call you back. 5 minutes and the MetaTrader was closed and funds were gone.
I never heard from her again only some Skype messages saying I don’t answer my phone any more and the manager is trying to call you to transfer it. Few days later had call from manager. All so nice and was disgusted in her not getting back to me, I will fix it and transfer it for you. Have I ever heard of mirroring. No I said, ok I will guide you, open Binance and deposit the amount from my bank account. I said I’m not doing that. I don’t have any money anyway. He said well it’s no use talking to then and started to get nasty. So I returned serve and he started swearing at me telling me I’m a broke useless so and so. He still didn’t let up as I said I’m reporting him to the police. He said go ahead here is my number and name. I will call you back in 20 minutes which he did. So he tried again same tactic. Same response from me then he started with his name calling etc.
I have handed all info over to a company that has good success rate in returning money though I doubt it very much.see what happens.
I don’t know how these pieces of shit live with them selves
Hi Phil,
I’m sorry to hear of this situation and thanks for letting us know. please feel free to contact our investigations team on +61 29188 7896, or via our contact form below. Should you be interested in pursuing the offenders, our team will advise you of costs to investigate and other process matters.
https://www.cybertrace.com.au/contact-cyber-private-investigator/
Hi, i have been scammed too for 5000 euro by FC trading. https://Fctlive
They did exactly the same as discribed above. Call you daily per whatsapp. Very friendly and helpfull. When i tried to withdraw some money 800euro. The needed to do a mirror transfer for 5000. After blackscreen where they had to connect to their bank…the money was changed into btc and then suddenly the btc were transfered to another wallet. I paniced and they neede 5k more which i refused. The website still shows my assets, but the btc adress I followed showed me the wallet was empty but transferred in total 62 btc…. they still call me weekly for another mirror-transfer to return my money. Already 6 different people called me with fake broker info from people out usa.
Unbelieveble that nobody can stop these guys
Hi Rene, thank you for your comment and we are sorry to hear of the situation. If you wish to discuss how we can help please contact our team via [email protected]
Hello, I’m receiving at least 5 calls, weekly, from fake trading brokers or platforms (metaquotes, forextrading) telling me that the company Group-500 I used to trade cryptos was a scam (something I know since 7 months ago) and they were the ones responsible to send me the money I owed. Each time the amount is different. Last time it was a very
tentative amount of $ 213,000. I requested an email from them with the explanation of the steps to follow. First the email address is @proton.me (nothing coming from a real company), second, the email doesn’t look professional, and third they explained the need to do a mirror transaction in order to verify that it was me. This transaction consisted in 1) opening a cold wallet called Atomic 2) asking me to deposited $6000 (3% corresponding to taxes???) and then, 3) they transferring $213000. As you said “to good to be true”. Thanks to this article and to my husband that alerted me about all the scam signs, I’m not attending any other phone call about this issue.
Hi Diana, we are pleased to see that this article has helped you.
Hi,
365Falcon is a crypto scam company.
My apologies in advance for the length of this. It could be longer!!
I opened an account with 365Falcon in November 2021. I did as much due diligence as I could before. Now there is a lot more ‘Do Not Touch’ info about 365Falcon. After opening the acct all looked to be OK with trades being made and the profit sent back to my Cryptopay account. (Cryptopay no longer deal with 365Falcon and advise anyone not to) The profit stopped being sent with the idea it will increase my acct balance which sounded ok. I was asked to deposit more and more. I was becoming nervous and asked for £10,000 to be transferred back to me. $9000 was transferred and told I had to keep a certain % in my account to keep it open. In total I sent over £50,000. When I finally said I cannot afford any more, Peter Larson, who was a main contact promptly (Eve Howard is another) told me their trading strategy had changed and my account had to be closed, which I was actually quite happy about!! Then the real scam kicked in. Peter Larson said all my funds had been transferred into Blockchain. They will still show on my account but there is nothing there!! To have them released I will have to pay a ‘fee per byte.’ Then the funds would be transferred into my escrow wallet.
Once you’ve completed the ‘Fee per byte’ linking procedure the total amount (1.00012369 BTC) will be automatically sent to the same wallet that have sent the ‘Fee per byte’ linking transfer as long it came from the a wallet verified with owner personal information (the amount will bounce-back once linking is completed).”’
I was sent wallet nos to transfer money into. None of which were mine, they were all Falcon. THEN I was told there had been a mistake and the funds had gone into another person’s account but if I transferred the same amount of money it would immediately ‘bounce back’ into my account. If I didn’t I would loose it all. At that point I gave up and resigned myself to the fact I would never see any money.
I was put to me that they could do nothing and it was my fault as I could not transfer what was needed.
Communication then promptly stopped.
Don’t have any dealing with this ‘company’. They are 100% SCAM.
If anybody can make any suggestions I am all ears.
I have now been contacted by MetaQuotes and being told I am eligible for a refund together with an email letter with FCA on the heading. The address quoted is a ‘Virtual address’
To get the refund it will involve a ‘Mirror Transaction’ as well as using AnyDesk or Team Viewer.
I think the old saying ‘If it sounds too good to be true, it probably is’.
I am just waiting to get to the point when I am told I need to make a financial transfer. Then its goodbye.
I hope lots of people get a chance to read this.
Hi Nigel,
Thank you for your comment and I am sorry to hear of the situation. Our team has reached out via email.
I was scammed by Cryptco Circus for $5500 US, lost all contact with them in Sept 2022 when I tried to withdraw my funds. Today I recieved a call from an agent stating that the said site was under criminal investigation and to avoid lawsuit they were refunding my money, which had now grown to 62,000 US, procceded to set me up with a new wallet etc. The catch, I was to send 10% 6200 US to my wallet, of course this was the last phase of the plan, I denied saying I had to consult the wife first and now I am expecting a return call on Monday, doing my due dillengence by reaching out here confirms my suspicions. Thank you
Hi Dave, Unfortunately there are many asset recovery scams out there and this does sound like one. If you wish to contact our team please submit a contact form via our website. Thank you.
This is so embarrassing writing this as I should have known better. This has impacted me to so bad. I was approached by a South African lady on Facebook who introduced me to an investment where I would make a lot of money money online. I was hesitant at the beginning but eventually agreed. I paid an amount of R1000 and asked me to register a profile on Profit Return 360 of which I did, she gave me a contact number for an Expert trader by the name of Gavin Andresen. I contacted him and he told me I must abide by the company rules. I saw profit increase from R10 000 within a week, and then increase to R20 000 the following week and within three weeks it was R100k and I was Wow by it. Thisman started to request that I pay a fee for a software which cost R5000 for me to withdraw which I did and I couldn’t withdraw because of Sars regulation, to my surprise fees started accumulating from Signal, IMF fee, Cost of transfer, Network fee, EA signal, Immigrant fee, Impediment fee. Trust me I paid him all these fees and till this day I have not received the profit. I wish I could the help from the company to recover all the money. These are the address I used on the Luno app to send money to him. I have all the messages between myself and Gavin Andresen
1Laj7qefhQEWxb49HnR9u5EUsKQNx9y9sP
1AzTNrDhe2oEJYHEGXGMw8Ym5nZmbofFiL
bc1qd7me2d26ahn8sp848s93hes0zcjad4vu7fvx2r
bc1qses73rj040jygh0v477325zjywfgfrt0qr8c74
Hi, I was also a victim of a crypto scam a year ago. A company calling themselves Quantrix Capital. They got me for $50,000 in the same or very similar way as everyone else that I have read on here. Recently I was contacted by people saying they were from the Blockchain.hub and could return my lost funds, which had now grown to $120,000U.S.. I needed to complete a six step verification process which, of course, required that I deposit money into a wallet to validate and liquify my account!!
Long story short, told them I had no more money and then it quickly changed into a one step process, which I declined and then they said they could do a mirror transaction!! Communication was thru phone calls, emails and telegram messenger, all fake.
Hopefully this reaches a few people and helps them not to get burned as I did.
Thank you
Hi Ken,
Thank you for your comment.
Our team have contacted you via email.
Thank you. It was really in the last minute when i receivef your article
I was going to send
thanks for your info. i was going to trade with a company called iToro stocks but there were to many inconsistencies in there story so i did not. this was six months ago. yesterday a fellow called himself steve with eastern European accent rang saying iToro was closing its operation and had a refund for me 1.65 bitcion, how very nice i thought. he could only transfer to a registered binance account after i transferred some funds from my bank account to it using the IBM mirror trading. All bollocks and very shaven ones i am Shure. told him i could not do it just now could he call back next friday. he will. this gave me time to cheque up on this mirror tradeing on this website and see what is going on. ofcourse the binance account is easy to transfer into without any extra steps. he also wants to use ANY DESK app to operate my computer. he will get nout but a polite brown eye from me. but i would love to know how to sting back. yours respectfully.
short arms deep pockets
Hi Niel, we are glad to hear that our blog helped you and that you were not a victim to a scam.
Dear sir a company called blockchain support been approaching me for my refund. They send an email and I don’t if the email is real or fake. Will be really grateful if you can look into the matter pls.
Hi Sanjeev, this is a recovery scam. Please submit a contact form via our website regarding the initial scam. Thank you.
I am a victim of mirror transaction fraud.
Hi Darina,
Our team has reached out via email.