The email that arrived in a Woodbury woman’s inbox on Valentine’s Day 2022 purportedly came from Geek Squad. It said her subscription to the 24-hour in-home computer support and repair services was being renewed. Her account would be debited $1,145.
“Years ago, we had a service contract with Geek Squad, so I didn’t think much about it,” the woman said. “The email said if I didn’t want to renew, I had 48 hours to cancel it, but that 48-hour period had already passed.”
The woman called the phone number listed on the email — which had a fake invoice number and an official-looking logo — and told the man who answered that she didn’t want to renew. “He said, ‘No problem. I can take care of that for you,’” she said.
Over the course of the next several days, the man and his accomplices ended up scamming the 78-year-old woman, a married mother of two adult children, out of more than $70,000.
“By the end, they had me so wrapped up and so scared and intimidated that I probably would have sold my house,” she told the Pioneer Press in a recent interview. “It’s just crazy.”
The scammers had the woman go to her Wells Fargo bank in Woodbury and withdraw $7,750 on three different occasions and $8,000 on another. Each time, she said, she was told to take the cash to a CoinFlip bitcoin ATM inside a gas station on Woodlane Drive in Woodbury. She had to enter a QR code provided by the scammers and feed the cash — one $100 bill at a time — into the ATM.
“It’s really sad, but there’s not much we can do,” said Lynn Lawrence, a Woodbury police detective. “The money is gone within seconds, and once it’s gone, there’s no getting it back.”
Attractive to scammers
More than 46,000 people in the U.S. reported losing more than $1.3 billion in cryptocurrency to scams from the start of 2021 through June 2022, according to a report by the Federal Trade Commission.
Several factors make crypto attractive to scammers: There’s no bank or other centralized authority to flag suspicious transactions, crypto transfers can’t be reversed and most people are still unfamiliar with how crypto works, according to the FTC.
When there were far fewer bitcoin ATMs around, it was much harder to run crypto scams, Lawrence said. Now, more than 375 bitcoin ATMs are up and running in Minnesota, including four in Woodbury, according to data from Coin ATM Radar.
“It’s much different if we have a victim who has transferred money from one bank account to another bank account,” Lawrence said. “Sometimes we can intercept those funds with the receiving bank and stop that kind of stuff, but with bitcoin, we don’t have those abilities, so really prevention and education is our only option at this point.”
Lawrence and the victim, who agreed to speak with the Pioneer Press on the condition of anonymity, hope that sharing her story will serve as a warning to others. “I don’t want anyone else to go through what I went through,” the woman said.
Cases involving cryptocurrency scams are especially frustrating for officials because they are so difficult to investigate, said Marty Fleischhacker, senior financial fraud ombudsman for the Minnesota Department of Commerce. “The thing about cryptocurrency is you really can’t trace it, so you have no real ability to find the perpetrators at any point by following the money trail, so how do you stop it?” he said. “That’s the problem.”
EXPLAINER: How cryptocurrencies and blockchain work
Adding to the problem: Crypto is highly unregulated and complex, so even when it’s not a scam, it’s very risky, Fleischhacker said. People should be aware of potential scams, and no one should give out any financial information without double-checking the source, he said.
“The old saying used to be ‘Trust, but verify’; now it’s ‘Verify before you trust,’” he said. “That’s what I always tell people. There is no leeway in that anymore, unfortunately, because there are certain organized criminals that are so good.
“They are Oscar-level actors. They know how to address all your concerns. They know how to mentally prepare you for what you’re doing. And they always have an answer as to how they’re helping you. They can add veiled threats in these situations to motivate the victim as well.”
Bottom line: Don’t believe anything anyone tells you, said Fleischhacker, who began focusing strictly on senior fraud in 2019. “You have to verify at the source that you look up yourself. If there is time pressure involved, and you haven’t met the person in-person who is on the phone and telling you about these time pressures, make sure you get somebody else involved. You can always talk to law enforcement or you can talk to a regulator confidentially, and you don’t have to worry about anyone knowing.”
‘They always start low’
Detective Nick Sullivan of the Washington County Sheriff’s Office investigated his first crypto case in the spring of 2021. Since then, he’s had dozens more, with more than $650,000 in losses reported by victims of cryptocurrency scams in 2022, he said.
Scammers used to send victims to Walmart, Target or The Home Depot and have them purchase gift cards, but now they’re being sent to bitcoin ATMs, Sullivan said. “They’re not changing the scams themselves,” he said. “They’re just changing the way they’re getting their money.”
In the fall of 2021, a man from Grant lost $382,000 in a Tesla investment scam after clicking on a pop-up message on his computer.
“He just fell for it,” Sullivan said. “He clicked on it and went through all the prompts. They always start low, right? It was $1,000, $2,000, $5,000, and then they just kept asking for more and more.
“A lot of times the victims get into this rut where they think, ‘Oh, I’ve just got to be able to recover this somehow.’ The scammers give them this sense of false hope. They’ll say, ‘Oh, we’re going to help you. You’re going to get your money back.’”
Scammers also persuaded a woman from Lake Elmo to go to her bank and withdraw $28,000, deposit it in a bitcoin ATM and transfer it to them. They said that if anyone at the bank asked, she was to tell them “she needed the money because she had to get her roof fixed,” Sullivan said. “She withdrew every dollar she had.”
The woman initially balked at the idea and said she thought it was a scam, but the woman on the phone convinced her otherwise, Sullivan said. “She said, ‘No, it’s not a scam. Go ahead and go on Google. Look up my name, and you’ll see a photo and that’s who I am,’” he said. “So she goes online, sees a photo and says, ‘Oh, OK, you must be legit.’ They set it up, and it’s so frustrating. It kills me. It absolutely kills me every day because there’s nothing I can do with this.”
Don’t answer
Don’t want to get scammed? Don’t answer your phone if you don’t recognize the number, Sullivan said.
“Anytime anybody calls and says anything’s wrong or they need money, hang up immediately and call somebody you know to validate that information, or call law enforcement,” he said. “These scammers, they’re going to stress the urgency of it. They’re going to say, ‘You have to do it now.’ No. There is no urgency. Just hang up and call somebody, or don’t answer the phone. I mean it seems so simple, but it’s hard. It’s hard, and then once they’re locked in, they’re in.”
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Scammers over the past year have targeted several Mahtomedi residents, including a 74-year-old woman who was scammed out of $40,000 after receiving a “Your Computer Has Been Locked” alert; a 73-year-old woman who was scammed out of $15,000 after receiving a phone call from a man claiming to be a PayPal employee; a 78-year-old woman who was scammed out of $15,000 by a man who called and said he was an Amazon employee; and a 72-year-old man who lost $18,000 after a man claiming to be an employee of his bank called to say he needed to withdraw money from his accounts at the bank and “deposit it in a bitcoin kiosk for safekeeping,” according to police reports.
At least three victims in St. Paul have reported losses of more than $100,000 in fraudulent scams since September, said Sgt. Mike Ernster, a spokesman for the St. Paul Police Department. The department received 727 reports involving fraud in 2022 and has received 215 so far this year, he said.
More and more of the reports involve cryptocurrency scams, Ernster said, but police feel there are likely even more victims.
“We believe these types of crimes are underreported due to victims’ feeling shame or embarrassment because they fell victim to the deception,” he said.
Fake Geek Squad email
When the fake Geek Squad email arrived last February, the Woodbury woman immediately called the phone number listed on the “invoice,” which had a 414 area code (Milwaukee).
“If I had been smart, I would have just waited until the charge came through and then called and told them that it wasn’t right,” she said. “And, of course, that charge would have never come through.”
The man on the phone, who said his name was “Brian,” directed her to an online form to have the money returned to her account. “It was a very simple form: name, address, amount of money,” she said. “He said to actually get the money back, I had to go to another website, and he told me how to get into it, and I put in my name, and I must have put in my bank and routing number. I do not remember doing that, but I must have.”
The scammer told the woman that she would need to put the amount she needed back “in two separate numbers,” she said. “The first number was $900. He told me to put in 900.00, and I’m 100 percent sure I did that correctly. Then I flipped to the next line, and I looked up, and it said 9,000.
“I went, ‘Wait a minute, it says 9,000. I know I put 900 in there,’” she said. “He said, ‘Oh my gosh, oh my gosh, that’s terrible. That’s awful.’ He went on and on. He said, ‘Can you change it? Can you change it?’ And I tried, and I said, ‘No, it’s not letting me change it.’ He said, ‘It’s probably already gone to your bank.’ He said, ‘Go check your bank,’ and he was, ‘Just do it, do it, do it,’ you know? So I went and looked, and it said $9,000 had been deposited. I said, ‘Well, it says there is $9,000 in there,’ and he just went on and on about how he was going to lose his job and how horrible this is. He had me shaking in my boots. I’m not a stupid person, but I thought I had done something just really horrible.”
The man insisted that she drive right to Wells Fargo and rectify the problem.
“He said, ‘Can you get to the bank? How many miles away is it? Are you dressed? Do you have your shoes on? Can you go right now?’” she said. “It was ‘Go, go, go.’ He wanted me to take out $7,750, roughly the difference between the $1,145 and the $9,000, and then he’d tell me how to get it to him later.”
The man told her to not hang up the phone while she drove to the bank and withdrew the cash. “I put it in my purse where I normally put it, but I kept him on the line,” she said. “Now, looking back, there are so many red flags, I feel even stupider.”
The man explained that she would need to convert the money into bitcoin and transfer it to him. He had her drive to a gas station on Woodlane Drive in Woodbury, not even a mile from her bank. “If it had been anyplace else, I would have told him ‘No’ because I would not drive to downtown St. Paul or anywhere else, but it was a familiar area,” she said.
It took almost two hours for the woman to get the bitcoin account set up at the CoinFlip ATM, which is located near the front window of the gas station between a live-bait kiosk and a MoneyPass ATM, and feed the money into it. “I’m standing under the bell that goes off every time somebody walks in the door, and I’ve got all this cash,” she said. “It was very stressful.”
One of the first messages that appear on the screen of the ATM is a warning asking users if they have been sent to make a payment for anything.
“STOP! You are being scammed,” the warning reads. “ALL TRANSACTIONS ARE FINAL AND IRREVERSIBLE!! FRAUDULENT TRANSACTIONS MAY RESULT IN THE LOSS OF YOUR MONEY OR CRYPTOCURRENCY OR BOTH, WITHOUT RECOURSE. Never send bitcoin or any cryptocurrency to someone you don’t know, or haven’t met in person.”
The woman said she doesn’t remember reading that message. “I was pretty panicked by then,” she said. “I could have bypassed it, as I was following instructions step by step, as I was told.”
CoinFlip officials did not respond to a request for comment.
The next morning, the scammer called the woman to say the money had not gone through.
“I went and looked at my account, and it showed (the money) back in my checking account,” she said. “What I didn’t know is that he had gone into my savings account and moved that much into my checking account. We did that three times. He kept saying, ‘It’s not going through. It’s not going through.’ It never dawned on me to look in my savings account. I didn’t know to do that.”
Over the course of the next four days, the woman had withdrawn a total of $23,250 from her accounts and deposited it into the bitcoin ATM.
“I’m old school,” the woman said. “I was raised that if you make a mess or cause something, you fix it. He said because of my error, the company was going to lock up the company accounts. He told me that there was $67,000 in there, and he needed to get it out, and he wondered if he could run it through my 401(K) or something. He would put the money in there, and then I’d take it out and send it to him, so they could put it somewhere else or some stupid thing. I balked at that because it did not make sense to me, and I made him explain it 10 dozen times.
“He wore me down,” she said. “It was the stupidest thing I’ve ever done, and that part of it is worse than the first part. I finally just gave in and said, ‘OK, I’ll do it.’ I just needed to get out, and I needed to be done.”
‘This is a scam’
The scammer told the woman that he was running a scan on her computer and that if she tried to access her 401(K) or checking account, her accounts “would probably be locked up for about six months,” she said. He directed her on Feb. 24, 2022, to return to Wells Fargo and wire $39,930 to “someplace in Peru,” she said. “The guy at the bank said, ‘This is a scam,’ but I was so positive I was just giving them their own money back. It’s just stupid.”
Wells Fargo officials didn’t immediately wire the money. They called the woman the next day to see if she was positive she wanted to send it. “I said, ‘Yes, send it,’ and they did,” she said. She also took out another $8,000 and deposited it in the bitcoin ATM.
Bank officials called the Woodbury Police Department to report the possible scam, and Lawrence and another police officer went right to the woman’s home. “When they came to the door, I was so grateful,” the woman said. “I just knew they were going to help me quit this and get me out of it.”
The first thing the officers did was tell the woman to close her laptop. “He had told me to never close it,” she said. “Well, I closed it — and within five minutes, he called and said, ‘Why did you close your laptop?’”
The woman later hired a company that specializes in cryptocurrency scams to investigate. She learned that the scammer worked in Kolkata, India.
“When I was sending bitcoin, they would always send me a receipt on my phone,” she said. “He told me to be sure to erase all those receipts. Well, I didn’t. They went in and traced all my bitcoin payments and the wire, and they located where they went.”
The woman has contacted police and the U.S. Consulate in Kolkata, but has had no response. “I really don’t have much hope of getting my money back, but they might get so tired of hearing from me, I don’t know,” she said. “There is a form online you can fill out, and I’ve filled it out I don’t know how many times, but I couldn’t make it work to send. It’s just very frustrating. It’s like beating your head against the wall. It really diminishes you. I think it changes your perspective of yourself and your whole life. It’s really destructive. If Wells Fargo hadn’t called the Woodbury cops, I don’t know what would have happened.”
“I’m not a stupid person, but everything went away after all the pressure and the intimidation,” she said. “It was the worst 12 days of my life. I think about it every, every, every day. That’s just the way it is, and nothing can be done.”
