Law enforcement agencies from the US, UK and Canada started a joint initiative called Operation Atlantic aimed at disrupting cryptocurrency fraud schemes known as authentication phishing attacks, the Ontario Securities Commission (OSC) said on Monday.
The scammers work by asking victims to approve malicious wallet permissions through fake alerts or pop-ups that appear to come from trusted apps or services, the OSC said. Once access is granted, criminals gain control of the wallet and can transfer funds. Because blockchain transactions cannot be reversed, recovery becomes difficult when assets leave a victim’s account.
Cryptocurrency fraud generated at least $14 billion in onchain revenue by 2025, according to Chainalysis, with totals expected to rise toward $17 billion as more illicit wallets are identified. Much of the activity now relies on social engineering tactics, complex AI-generated content and phishing-as-a-service platforms to trick victims into providing wallet access or transferring funds.
“Approval phishing and investment fraud cost victims millions in financial loss each year,” said Brent Daniels, deputy assistant director of the US Secret Service’s Office of Field Operations, which is involved in the project.
The operation builds on Project Atlas, a 2024 initiative led by the Ontario Provincial Police’s Cyber-Enabled Fraud Team to combat global crypto investment fraud. The project identified over 2,000 compromised wallets across 14 countries, disrupted about $70 million in potential fraud and froze about $24 million in stolen crypto. Similar international efforts, such as Chainalysis’ Operation Spincaster, generated more than 7,000 investigative leads linked to around $162 million in losses, highlighting the scale of authentication phishing schemes targeting crypto investors.
Authorities said the new operation will help alert potential victims and guide them to secure compromised wallets while trying to trace and recover stolen funds.
“Under Operation Atlantic, the Secret Service, along with our international law enforcement partners, will identify and disrupt these scams in near real time, denying criminals the opportunity to further profit from their crimes,” Daniels said.
