The Recovery Scam

The following story is based on actual events. Names, locations and timelines may have changed to protect the victim’s identity.

In investment recovery scams, fraudsters keep a list and contact previous investment scam victims by telephone, email, social media or use search engine optimization and claim to the victim that they can return the funds lost in a previous investment scam. Fraudsters will tell victims that there is a fee for their services and, in some cases, will ask for remote access to their computer or device. In the end, no funds are returned and more funds are potentially stolen.

Graphic of thief running with a money bag + definition of recovery scam.

The First Scam

In 2024, Linda invested over $100,000 USD in cryptocurrencies, like Bitcoin and Ethereum, through a Simplewealthfx.com account. Linda later found herself unable to get any money back and realized that the people and company she had been dealing with were not honest. Unfortunately, when she initially invested, Linda did not know that, on November 28, 2023, the Ontario Securities Commission had already issued an Investor Alert warning that SimpleWealthFX was not a registered trading platform.

The Second Scam

Just when she thought things couldn’t get worse, Linda received an unexpected call from a man named Henry, which left her feeling both hopeful and wary.

Henry presented himself as part of a new team dedicated to righting the wrongs of the past. Henry explained he had uncovered that some employees had been scamming investors, including Linda. The man promised he could recover the lost investment and even the profits. Henry’s assistant, Samantha, then told Linda that she needed to send them $5,000 for the crypto assets to be converted to Canadian dollars.

“Am I getting scammed again?!?!” Linda

Despite the hopeful message, Linda had her doubts. After all, this was a platform known for its dishonesty. Could these people really be different, or was this just another trap?

CIRO is Committed to the Protection of Investors!

Linda reached out to CIRO for help and was informed this was a scam and instructed her to cut all communications immediately. CIRO also advised her to report what happened to her financial institution, local law enforcement and the Canadian Anti-Fraud Centre and also to put a fraud alert on her credit report. By following these steps, Linda was spared from being victimized a second time.

Check out our resources to learn more on how to protect yourself!

Also check out the Investor Alerts section, which warns Canadians about certain firms and individuals that have come to the attention of CIRO for potential harmful activity.

Remember!

Before investing, research the investment, individuals and firms thoroughly to verify their legitimacy.
Visit CIRO’s Avoiding Fraud and Protecting Your Investments section for more information.