Russian police have shut down an illegal crypto mining farm operating in an industrial zone in St. Petersburg, as the internal affairs ministry has warned of a new crypto trading-themed scam.
Per the media outlet RBC, officers in Russia’s second city confiscated an undisclosed number of crypto mining rigs from a warehouse in the zone, off the iconic Mitrofanievsky Highway.
St. Petersburg: Crypto Mining Farm ‘Liquidated’
St. Petersburg emergency forces officials shared images of the farm, which were published on the VK page Spb Today.
They explained that power experts estimated that the crypto mining operation had caused 10 million rubles ($127,873) worth of damage to the city’s power grids.
Police shared images and video footage of the farm before they dismantled it, “confiscating all equipment” in the process.
The video shows dozens of crypto mining rigs in operation, as well as two electrical meters that appear to have been overridden.
A Ministry of Internal Affairs spokesperson said that the site was completely unmanned when police arrived. However, a manhunt is now underway as officers search for the operators.
Mitrofanievsky Highway gained global fame when it featured in the Fyodor Dostoevsky novel Crime and Punishment.
Officers said the crypto mining farm operated over several hundred square meters of floor area. The operators provided power to the facility via a main distribution board connected to a neighboring substation.
Scam Warning
Meanwhile, the Russian state-run news agency TASS reported that the Ministry of Internal Affairs has warned the public about a new crypto-themed fraud scheme.
The ministry said that the scam makes use of foreign call centers, whose operatives call Russian residents claiming to offer crypto trading training.
Callers telephone potential victims claiming to be (or to represent) experts who have degrees from prestigious universities such as Moscow State University.
Alternatively, they claim to be employees at major stock exchanges, hedge fund managers, or professional traders.
After slowly gaining their victims’ trust, the ministry explained, scammers then convince them to register accounts on specific crypto exchanges to help advance their “training.”
Scammers then typically persuade their victims to make investments worth at least $100, promising that these will yield profits worth up to $60 per transaction in “just 15 minutes.”
Gaining Victims’ Trust
The sophisticated scheme then sees scammers reward investors with small “profit payments” worth around $3.
The fraudsters then convince victims that they could make much more money if they increased the size of their stakes to $300-$400, taking out loans if needed.
The ministry explained that the scammers’ ultimate goal is to try to win enough of their victims’ trust so that the latter eventually lets the “expert” take control of their account.
“Fraudsters want to give the impression that they are leading the victim by the hand through the whole process,” the ministry said.
Finally, under the guise of paying out the profits of a successful transaction, the fraudsters strike by transferring all of the victims’ funds to their own crypto wallets.
Last month, a court in Moscow jailed Valeria Fedyakina, an influencer and businesswoman also known as Bitmama, for seven years.
The court found her guilty of masterminding a crypto-related fraud network worth around $21.3 million.
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