Recovery Frauds and How to Avoid Them

Feb 16, 2024 | Crypto Scam Defense, Fake Websites | 0 comments

Have you ever been approached by someone promising to help you recover money you’ve lost to a scam? Recovery fraud takes advantage of this very situation, where fraudsters act as saviors, offering assistance to victims desperate to reclaim their losses.

These scammers, however, have a different goal, to deceive victims into paying upfront fees or handing over sensitive personal information, as a result, increasing the victims’ financial problems rather than relieving them.

In this blog post, we’ll talk about what recovery fraud is, recognizing refunds, and recovery scams, and the 7 refund recovery fraud more common. 

What is Recovery Fraud?

Recovery fraud is a form of advanced payment fraud where scammers, under the pretext of offering help, exploit individuals who have already been victims of scams. These fraudulent actors make requests for payment or sensitive personal information, falsely promising to assist victims in recovering their lost funds.

The tactics employed by these fraudsters are sophisticated, involving the impersonation of reputable entities such as:

  • Businesses
  • Legal institutions
  • Official bodies

By pretending to be part of a bank’s fraud team, for instance, they project an image of legitimacy and authority, convincing victims that they have a real chance of recovering their swiped stuff.

Hacker trying to get into the system

How Recognizing Recovery Fraud

Identifying recovery fraud is essential for safeguarding against further financial harm. These scams are characterized by several red flags that, when recognized, can help prevent you from becoming a victim. 

Initial Fees

A significant warning sign of a recovery scam is the demand for initial fees before any service is provided. Legitimate service providers typically charge their clients after completing their work, making initial fees a major red flag.

Warning Signs in Communication

Emails or messages full of spelling mistakes and the use of personal email addresses rather than official business ones are indicators of potential scams. Professionalism in communication is a characteristic of legitimate organizations.

Information Gathering Excessive

Be careful if you’re asked for an unusual amount of personal information early on. Requests for email addresses, phone numbers, or other sensitive data can be a signal to identity theft or further scams.

Confidential Data Requests

Legitimate recovery processes will never require you to provide personal or business bank account details upfront. Scammers might claim this information is necessary to deposit recovered funds, but their real intention could be to empty your account.

False Privileged Access

Another tactic is tempting victims with promises of special access to government agencies or influential contacts, suggesting they have special connections to speed up the recovery process. Such as are often too good to be true.

Few Contact Details

A lack of verifiable contact details for a company or organization to assist with recovery is a concern. Legitimate businesses provide transparent contact information, including physical addresses on their websites.

Scammers with Excessive Knowledge

Be suspicious if a recovery company knows too much about your initial fraud case without you providing that information. Legitimate organizations will collect details directly from you during their investigation.

laptop, card and money

How to Protect Against Recovery Scams

Protecting yourself from recovery scams requires a multi-faceted approach that emphasizes education, doubt, and diligent verification of any recovery service providers. Due to the difficulties of fraud in the digital and cryptocurrency realms.

Stay Informed

Awareness is your first line of defense against recovery scams. Regularly update yourself on the latest fraud tactics and scam trends through trusted sources like government agencies, financial institutions, and consumer protection organizations. 

Question Unexpected Offers

Treat any unsolicited communication with caution. Scammers frequently initiate contact, offering recovery services without prior request. Verify the authenticity of these offers by researching the individual or organization making the contact before responding or providing any information.

Research the Organization 

Before engaging with a recovery service, conduct in-depth research. Look for verifiable contact details, physical addresses, and a professional online presence. Reviews and feedback can provide valuable insights into the legitimacy of the organization.

Don’t Upfront Fees

Legitimate recovery services do not require payment upfront. A request for payment before services are provided is a significant scam indicator. Always refuse to pay upfront fees and be cautious about sharing any financial details.

Check Government Agencies

If approached by someone claiming to represent a government agency, independently verify their identity through official channels. Scammers may impersonate authority figures to gain trust, so use only officially listed contact information to confirm claims.

Protect your Data

Do not share sensitive details like social security numbers, bank account information, or credit card numbers with unknown parties. Legitimate organizations will respect your privacy and not demand such information upfront.

Ensure payment security

For any transactions, opt for secure payment methods. Keep clear of hard-to-track methods like bank transfers, gift cards, or cryptocurrency. Established entities will offer secure payment options, ensuring your financial safety.

Report Scams

If you encounter or suspect a recovery scam, report it immediately to the appropriate authorities, such as your local law enforcement, state attorney general’s office, or consumer protection agencies. 

Writing information card into the cell phone

The 7 Refund Recovery Fraud More Common

Recovery frauds stand out for their smart exploitation of victims’ hopes. Here, we explore the seven most common refund and recovery frauds:

1- Cryptocurrency Recovery Scams

The Federal Trade Commission (FTC) reports a staggering loss of over $1 billion by 46,000 Americans to crypto scams since 2021, marking a 60-fold increase since 2018. 

Scammers on social media use bots to advertise help from someone claiming to be a crypto recovery expert, focused on people who are upset about losing their investments.

2- Overpayment Scams

This scam involves scammers overpaying for online goods or services and then requesting a refund of the excess. Victims later discovered the original payment was made with stolen credit card details, leading to a reversal of the transaction and financial loss for the seller.

3-  Profiles Offering Recovery Services on Social Networks

Scammers target individuals sharing their experiences of being scammed on social media, offering fraudulent recovery services. These fake specialists typically promise to retrieve lost funds, only to scam victims further.

4- Stolen Vehicle Recovery Scams

Scammers claim to have located a stolen car and demand payment for its return, only for victims to discover they have fallen victim to a scam and have an additional financial loss.

5- Tech Support Refund Scams

In this method, victims receive false invoices for tech services. When disputing the charges, they’re manipulated into believing they’ve been refunded too much and are forced into returning the supposed excess.

6- Investment Fraud Recovery Scams

After falling victim to investment scams promising unrealistic returns, victims are often targeted by scammers offering to help recover their losses, leading to additional financial and emotional strain.

7- Amazon Refund Scams

Exploiting the customer base of Amazon, fraudsters engage in refund scams, including selling fake products or claiming to offer refunds for undelivered goods, further reducing trust and causing monetary loss.


As we have explored the dangers of Recovery fraud, the preparation cannot be overstated. Gaining knowledge and adopting a vigilant stance is essential to avoid the dangers posed by these scams. It’s not simply about avoiding losses; it’s about promoting a secure environment for all. 

The Cryptoscam Defense Network stands at the forefront of this mission, offering an abundance of resources, educational materials, and a supportive community designed to empower individuals against scams.

We Want to Hear From You!

The fight against cryptocurrency scams is a community effort, and your insights are invaluable. Have you encountered a scam, or do you have questions about navigating the complex world of digital currency? Maybe you have suggestions or want to share your story to help others. Whatever your experience, we’re here to listen and support you.

Reach out to us at Share your stories, ask questions, or make comments. Your voice is crucial in building a resilient and informed community. Together, we can improve our defenses and promote a safer digital space for all.

Be a part of the change. Your story matters.