Crypto investment fraud: when the tax office taxes phantom gains and what to check now

A return shown on a fraudulent trading platform can be taxable even if not one euro ever reached your account. That is the most unpleasant news for anyone who has just realised their money is gone: a tax demand can follow the loss. Whether it arises depends on a single question, and your own paperwork can answer it.

The trigger is the regulator's ongoing series of warnings. Between September 11 and September 16, 2026 alone, BaFin published thirteen consumer notices, seven of which concern offers with a crypto-asset connection. One of them describes the second stage of the damage precisely: a website offering victims the recovery of lost crypto-assets.

Crypto investment fraud: what BaFin reported this week

The regulator publishes such notices on the basis of Section 37(4) of the German Banking Act and Section 10(7) of the German Crypto Markets Supervision Act. This is neither a judgment nor an indictment. It is the information that, according to the authority's findings, a provider is conducting business requiring authorisation without holding that authorisation. For you as an investor it is the most important advance warning available, and it costs nothing.

The notice of September 16, 2026 on the trading platform arbitpad(.)de puts it in the typical wording: there is a suspicion that the unknown operators are offering financial services and crypto-asset services there without the required authorisation. The same day brought a warning about xlla(.)tech, whose operators according to BaFin present themselves as a fictitious company based in Switzerland, as well as a warning about a series of near-identical websites that all work with the same advertising copy about a supposed AI investment.

Two days earlier it was berlinbank(.)eu, where, as the regulator describes it, banking business and crypto services are provided without authorisation, including the opening of bank accounts and investments in crypto-assets. The name sounds like a German institution. That is exactly the purpose.

Our count: thirteen BaFin warnings, seven involving crypto

cryptoticker.io compiled this count itself on September 16, 2026. Method: we called up the overview page of BaFin consumer notices, opened every notice listed there with a publication date in September 2026 individually and checked the text of each notice for the terms crypto-assets and crypto. Objects checked: thirteen notices from the period September 11 to 16, 2026, each retrievable with HTTP status 200.

The result: seven of the thirteen notices explicitly name crypto-asset services or investments in crypto-assets. Four of them date from September 14 and 16 alone. In four of the seven cases BaFin speaks of unknown operators, in two cases of identity abuse at the expense of German companies that really exist. One notice describes the recruitment of money mules through Telegram chats, in which those affected are asked to pass other people's money through their own account and exchange it into crypto-assets.

What this figure does not give you: the value describes the volume of notices in a single week on a rolling overview page, not the total number of all warnings in the month, and certainly not the number of investors actually affected. BaFin does not publish how many people paid into the sites named. We also evaluated only the visible text of the notices, not case files.

Phantom gains explained: why the number on the dashboard is not money

A phantom gain is a return that a platform credits to you although no real investment and no real income lies behind it. A growing number appears on the screen while nothing at all is held in the account. In the classic variant, the Ponzi scheme, the few amounts actually paid out come from the deposits of investors who joined later.

The crypto variant works the same way but seems more credible because it mirrors real price data. You see a chart that looks like the real market and, next to it, your supposed holding. Anyone wanting to verify the price history will find the real data for the largest asset on any reputable site anyway, for instance in our Bitcoin price prediction. The prices on the fraudulent platform are often even correct. The only thing that is wrong is the assumption that a coin stands behind your position.

The warning sign that almost always appears first

As a rule the fraud does not come to light when you pay in, but when you try to take money out. As long as you are sending money, everything runs smoothly. As soon as you want to withdraw, a condition appears: a supposed withholding tax, an unlocking fee, a verification payment, a deposit for the bank. Every one of these demands serves the same purpose, namely a further payment.

A reputable platform offsets fees against the withdrawal amount and does not demand payment in advance for handing you your own money. No German tax office collects taxes through a trading platform abroad.

Phantom returns and tax: what the Federal Fiscal Court decided

This is where it becomes bitter for victims. The Federal Fiscal Court has ruled several times that phantom returns credited in Ponzi schemes are in principle taxable, even if they were never paid out. What decides the matter is the operator's position at the time of the credit: would they have been willing and able to pay, had the investor demanded payment? Whether money actually flowed in the end is secondary.

In its judgment of October 27, 2020 (case number VIII R 3/20) the Eighth Senate took this further for withheld capital gains tax: the settlement effect under Section 43(5) sentence 1 of the German Income Tax Act also applies where the fraudster withheld the capital gains tax but never registered or remitted it to the tax office. In doing so the Senate takes the perspective of the investor, who was entitled to assume the withholding was proper.

For you this means two things. First, a mere credit entry in the platform account can be an inflow for tax purposes. Second, a great deal depends on what your paperwork says, because the case law attaches to details that emerge only from statements, e-mails and bank records.

When no tax arises after all

An inflow is ruled out if the platform was demonstrably unable to pay at the time of the credit. This is precisely the lever for those affected: anyone who can show that payment was already being refused systematically at that time has an argument against an inflow for tax purposes. The proof lies in the correspondence, in rejected withdrawal orders and in the answers from support.

The case also lies differently where the platform never pretended to offer an interest-bearing capital claim and only ever showed price gains on a coin supposedly held. The question is then no longer investment income under Section 20 of the Income Tax Act but the rules for private disposal transactions under Section 23. How this distinction turns out in an individual case is decided by the tax office on the basis of the contractual documents, and it is the reason why blanket answers are worth little here.

Payout against an advance fee: the pattern behind the second payment

Anyone who has paid once counts as a good contact in this industry. That is why the damage rarely ends with the first transfer. On September 14, 2026 BaFin warned about offers on the website finanzforensik(.)com and the associated e-mail address. According to the authority's findings, the recovery of crypto-assets and their payout to a wallet or a bank account is offered there.

Two points in the notice matter for detection. According to BaFin, the unknown operators claimed to be cooperation partners of the authority, which the regulator expressly denies. And in their imprint they used the company data of a real firm from Hesse. The regulator calls this identity abuse; the genuine company has nothing to do with the offer.

How to spot a recovery offer

The scheme has fixed features. Contact comes unprompted, often shortly after the loss, by e-mail, telephone or messenger. The provider promises a success rate that no lawyer and no authority could seriously quote. It demands an upfront fee, a file-reference charge or a deposit. It invokes cooperation with an authority, with a bank or with a law firm that you have not checked yourself.

Authorities do not work with private recovery services on a contingency basis, and nobody can reverse a blockchain transaction that has already gone out by paying a fee. What actually helps is a criminal complaint, securing the evidence and notifying your bank, provided a direct debit or card payment is still inside the chargeback window.

BaFin company database: how to check a provider in three minutes

The regulator keeps a public register of all companies to which it has granted authorisation. It sits in BaFin's company database and is searchable without registration. The procedure takes a few minutes and is the same for every new provider.

Start with the exact company name from the imprint rather than the brand name of the website. Then compare the registered office and legal form with the details on the site. If you find nothing at all, that in itself is already a reason not to transfer any money. If you find a hit, check whether the authorisation listed matches what is being offered to you: a licence as a payment institution does not cover crypto-asset services. A detailed guide to this is in our article BaFin warning: how to check a crypto provider in three minutes.

Anyone wanting to save themselves this step should stick to trading venues with demonstrable European authorisation. A provider listed in the regulator's register can still be expensive or unsuitable; it is at least tangible, and that is the difference that counts here.

The features that keep recurring in this week's notices

Unknown operators with no tangible people in charge. An imprint carrying the data of an unrelated company that really exists. An invented registered office in a country with a good reputation. A series of websites with an almost identical structure under dozens of domains. Advertising copy telling of a new AI investment supposedly tested by an editorial team. Contact through a messenger app in place of a business address.

None of these features proves a criminal offence on its own. Taken together, however, they describe quite precisely what the regulator warned about thirteen times this week.

Losses from investment fraud: what works for tax and what does not

The obvious hope goes like this: if phantom gains are taxed, then at least let the loss be deductible. It is not that simple. For crypto-assets held privately, Section 23 of the Income Tax Act applies in principle, and it requires a disposal. Where nothing was sold because the money simply flowed away, that event is missing. This is why the tax authorities generally do not recognise theft and fraud as a deductible disposal loss.

Things can look different if the investment was structured as an interest-bearing capital claim. A loss in the area of investment income then comes into consideration, subject to the offsetting restrictions that apply there. This distinction decides a difference of several thousand euros and belongs in the hands of a tax adviser who can see the contracts.

Regardless of that, it is worth looking at what belongs in your tax return anyway: realised losses from real sales. Anyone who has documented their transactions without gaps argues considerably better before the tax office, and in both directions, when offsetting losses as well as when fending off a demand for income that was never received. The right tools for that are in our comparison of crypto tax tools and portfolio trackers.

Police report, evidence, deadlines: what counts in the first few days

As soon as the suspicion arises, speed counts, and in this order. Stop every further payment, even if you are told that only this one amount stands between you and the payout. Then secure everything you will need later: bank statements, transfer receipts, transaction hashes, the complete e-mail and chat history, screenshots of your account balance on the platform including the date.

File a criminal complaint with the police; with most state criminal police offices this is also possible online. Inform your bank if payments ran through direct debit or credit card, because depending on the procedure recovery options may still exist there. Report the case to BaFin through its consumer contact point, because the regulator feeds such tips into its warning practice.

And plan for the tax side instead of pushing it away. If in a previous year you declared income from the platform that never existed, correcting the tax return concerned is the right way. Set up a file for it in which deposits, credits and every rejected withdrawal appear in chronological order; that very sequence later decides the question of the inflow.

Crypto investment fraud: what you should take away

1. Check the provider before you transfer. Enter the company name from the imprint into the BaFin company database and match the type of authorisation against the offer. If that is too much trouble, stick to trading venues with documented authorisation from our comparison of the best regulated crypto exchanges.
2. Never pay for a payout. Fees, taxes or deposits that fall due before your own balance is transferred are the most reliable identifying feature of the fraud. The same applies to every offer to recover lost coins against an advance fee. How withdrawals actually work at established trading venues is shown by our comparison of the best crypto exchanges.
3. Settle the tax question actively. Check whether you declared income from the platform in earlier years, and collect the evidence for rejected withdrawals. For the ongoing documentation of your real transactions, a tool from our comparison of crypto tax tools and portfolio trackers helps.

(As of September 16, 2026. This article is not investment advice. Prices and fee structures change; check the terms with the provider before you buy.)