Crypto recovery law firm increases turnover by 600%

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Chinn: Gap in the market

A law firm that specialises almost entirely in recovering money for victims of cryptocurrency investment scams increased its turnover last year from £500,000 to £3m, recovering £10m for clients.

Josh Chinn, a solicitor and director of Wealth Recovery Solicitors ETL (WRS), said turnover was likely to increase further this year because the firm had a further £35m of crypto recovery work – 95% of it handled on a conditional fee basis.

Mr Chinn launched the law firm, an alternative business structure regulated by the Bar Standards Board and based in Manchester, in March 2021, with property developer Richard Irving, director of operations.

International professional services group ETL Global took a minority stake two years ago through the Manchester commercial law firm it owns, Glaisyers ETL.

Mr Chinn said the key to its success was when it invested “really heavily” in cryptocurrency tracing software at the end of 2021. Before that, it had specialised in recovering money for people who had fallen victim to Cyprus-based investment scams.

“We realised there was a gap in the market. Crypto leads were coming in, but we rejected them because we didn’t know what to do with them.

“A lot of people are making money in cryptocurrency, and many of them are making it by scamming people. They create legitimate-looking trading platforms, offering really handsome returns.

“The clients purchase legitimate cryptocurrency which they transfer out of their wallets to wallets controlled by the scammers. There is often no actual investment but a lot of fluff to the get the currency under the scammers’ control.”

Mr Chinn said the WRS software could show how clients were defrauded. The firm can then either recover the money through litigation or, more usually, seek compensation directly from banks that failed to make sufficient checks.

The firm recently recovered £580,000 for a client who invested £520,000, when 8% interest was added to the compensation paid by a bank.

It also recovered in two weeks £500,000 for a client who lost £1m and was quoted a six-figure legal fee by a London law firm for investigating and pursuing his claim.

The solicitor said losses often “cleaned out” clients, leading to a lack of appetite for litigation and attraction to the ‘no win, no fee’ approach.

“We take on the risk. We know what wins a case and we have a good relationship with the banks and with the Financial Ombudsman Service.”

Mr Chinn said WRS was likely to beat last year’s turnover of £3m in 2024 and the £10m it recovered for victims, having secured compensation of £2m this month alone. The firm is waiting for an award of £700,000 to be approved for a wealthy female client who lost £1.2m.

The firm is acting for around 180 victims of the high-profile HyperVerse crypto scheme, seeking compensation of around £6m.

Staff numbers at WRS doubled last year to 15 and more are being recruited, with the firm moving last month to new offices in the Spinningfields district of Manchester – in the same building as Glaisyers, but separate from it.

Mr Chinn said he did not know any other law firm that delivered the same results when it came to crypto recovery or had access to the same technology. “We are the leaders in his field. There is no competition.”

WRS also does tracing work as experts for UK law firms and accountants, and for foreign professional services firms in places such as Dubai, Lithuania or America, and produced reports which could be used in court.

“Our message to them would be: Don’t reject good work because you don’t understand one aspect of it. Offload it onto us.”