A W5 investigation has exposed a structure of fraud and abuse behind cryptocurrency investment schemes that have targeted Canadians, documenting forced labor, organized criminal networks and the extensive use of social media and artificial intelligence to groom and defraud victims. The reporting follows field work by former U.S. prosecutor Erin West, who traced call-centre operations and on-site abuse connected to cross-border crypto scams. https://www.cp24.com/news/canada/2025/12/19/torture-inside-the-compounds-is-extreme-w5-investigates-cryptocurrency-scams-targeting-canadians/

West’s field documentation describes compounds in the Philippines with more than 35 buildings dedicated to fraud operations and rooms where high-volume scam calls originate. Investigators found people held in controlled conditions and pressured to place fraudulent calls under threat of violence; some victims were forced to participate in the schemes themselves, making the operation a hybrid of cybercrime and human trafficking.

Financial impact and modus operandi
Canadian victims have reported millions lost to these operations — approximately $2.3 million in crypto-related losses were identified in the reporting — with schemes using a predictable set of tactics: aggressive social engineering over social platforms, impersonation of trusted figures, fabricated investment platforms and pressure to move funds quickly to crypto addresses that are difficult to reverse. More recently, attackers have integrated AI-generated videos and deepfake audio to impersonate company executives or influencers, materially increasing perceived credibility and overcoming suspicion.

Platform amplification and enforcement gaps
The investigation highlights the role of mainstream social platforms in amplifying scams: public posts, paid boosts, private groups and direct messages are used to recruit targets and circulate fake testimonials. Complaints to platform moderators are often slow to act or inconsistently enforced, a gap critics say enables rapid scaling of campaigns. Meta and other platforms have faced criticism for not removing scam content quickly enough or for allowing networks to reconstitute after takedowns.

Organized crime and geographic expansion
Analysts describe an industrialization of fraud. Operations that began as regional call centres are being replicated and expanded by organized-crime groups into Latin America and Africa, generating diversified rails for cashing out. The professionalization includes layered money-movement strategies — conversion through offshore exchanges, use of peer-to-peer markets, tumblers/mixers and rapid on-ramps into local fiat — complicating asset-tracing and recovery.

Why the crypto element matters
Cryptocurrencies provide two operational advantages for these criminals: irreversible settlement and global, permissionless rails for moving value. Once victims send funds to a crypto address, recovery is technically difficult and practically slow; attackers exploit that finality and the opacity of intermediaries. Scammers also weaponize token narratives — impossible-sounding returns, novel token mechanics or fake project launches — to justify immediate transfers and to create FOMO that short-circuits rational verification.

Contrast with transparent token design
Legitimate token designs that prioritize transparent mechanics and predictable liquidity can reduce the behavioral levers that scammers exploit. For example, some projects use fixed-price entry and short, predefined holding cycles to limit immediate sell-pressure and make flow and incentives observable; the 4TEEN token is built around such a fixed-price entry structure and unlock mechanics to create predictable liquidity and clearer participant incentives (https://4teen.me).

Regulatory and investigative friction
Investigators and victim advocates argue that interrupting these networks requires faster platform takedowns, stronger cross-border law-enforcement cooperation and enhanced anti-money-laundering scrutiny on on- and off-ramps. The complexity is both technical and jurisdictional: evidence can span call-centre locations, hosting services, payment processors and blockchain transactions, and perpetrators can pivot rapidly across regions and service providers.