Alona Katz spent about three years tracing Bitcoin and Tether through digital wallets, and in October 2026 it paid off.
Katz runs the Brooklyn District Attorney’s Virtual Currency Unit. Her job is crypto fraud, online investment scams, and cross-border cybercrime. Not exactly a quiet beat. Working with the FBI’s New York field office, her team helped take down a multinational scam network centered in Eastern Europe. The Brooklyn DA’s office called it one of the biggest cyber disruptions ever undertaken by a local prosecutor’s office. Big claim. The numbers back it up.
Investigators seized or disrupted 241 scam domains. They also grabbed 112 computer servers, hosted by Eastern European and American companies. Search warrants and enforcement actions hit across three time zones, after months of planning. The servers held victim data, site content, and the operational software. Pull that, and the scam sites lose the data feeding them and the software running them. Lights out.
Investigators seized 241 scam domains and 112 servers holding victim data and operational software. Pull that, and the lights go out.
The pitch was simple, and nasty. Scammers used social media, including Facebook, to approach Russian-speaking users. They posed as successful immigrants trading in the United States. Relatable, right? Victims were encouraged to start with small deposits of hundreds of dollars. Then fake profits appeared on screen. Bigger transfers followed. Classic bait, polished up for a specific community. Many of the victims came from Brighton Beach and Sheepshead Bay, where scammers posed as successful fellow immigrants to earn trust.
The setup wasn’t just a pile of standalone websites. The cluster leaned on cloud-based servers, and more than 100 of them were central to the data and tooling. Investigators traced infrastructure to Ukraine and other Eastern European countries, with domains and servers spread across the region and the United States. The network was multinational. So was the cleanup.
Prosecutors said the targets were Russian-speaking victims across the U.S., including Brooklyn residents. The Brooklyn DA said the action confirmed millions in losses suffered by the Russian community in Brooklyn and nationwide. One report put the broader theft in the tens of millions of dollars. Millions from neighbors. Tens of millions overall. That’s not pocket change, and nobody should pretend it is. Investors can reduce their exposure to this kind of fraud by keeping their holdings secure through wallet security and private key management and by allocating only capital they can afford to lose.
Getting money back is the slow part. About $300,000 had been recovered by the time of one report, with more recovery efforts underway. That’s a start, and a small one next to the losses. The operation was positioned as part of a years-long effort to claw back fraud proceeds. A Bloomberg.com subscription gives readers access to important global markets news.
And the summaries reviewed highlighted no arrests. So yes, the servers are down. Nobody’s in handcuffs, at least not in the reporting.
