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The US Department of Justice (DOJ) announced on Wednesday one of its largest-ever seizures of cryptocurrency, totaling over $225 million, linked to an extensive network of fraudulent “pig butchering” scams.
The civil forfeiture action targets funds traced to a series of deceptive investment platforms that lured individuals with the promise of legitimate cryptocurrency opportunities, only for them to fall prey to sophisticated criminal operations, often based overseas.
Federal Crackdown On Crypto Fraud
Shawn Bradstreet, Special Agent in Charge of the US Secret Service’s San Francisco Field Office, emphasized the significance of this seizure, noting it as a historic milestone in the agency’s efforts to combat crypto fraud. “This seizure marks the largest cryptocurrency seizure in US Secret Service history,” Bradstreet stated.
Bradstreet highlighted the emotional and financial toll these scams exact on victims, underscoring the collaborative efforts among the Secret Service, the Federal Bureau of Investigation (FBI), and private sector partners to trace illicit transactions and identify those affected.
The FBI’s San Francisco Special Agent in Charge, Sanjay Virmani, echoed these sentiments, pointing out the devastating consequences of such investment schemes. “In this case, hundreds of victims lost millions of dollars to an elaborate scheme,” he remarked, commending the investigative team’s diligence in recovering stolen assets.
The FBI continues to pursue the criminals behind these heartless frauds, working alongside federal partners and industry experts to disrupt these malicious networks and recover funds for victims.
Tether’s Key Role
Authorities have linked the fraudulent network to approximately 400 suspected victims globally, including dozens within the United States.
According to FBI data, crypto fraud was responsible for more than $5.8 billion in reported losses last year alone. The seized funds are now subject to forfeiture proceedings, with the aim of eventually returning the money to those who were duped.
In tracing the illicit funds, the US Secret Service and FBI utilized advanced blockchain analysis tools, which proved crucial in uncovering the origins of the stolen assets.
The operation received notable assistance from Tether, the world’s largest stablecoin issuer, USDT, which played a pivotal role in the investigation. The complaint revealed that the funds were connected to extensive money laundering and theft related to confidence scams, which often exploit personal relationships to gain victims’ trust.
The network’s complexity was further illustrated by its reliance on hundreds of thousands of transactions designed to obscure the origins of the funds, employing sophisticated blockchain maneuvers to conceal the flow of stolen assets.
The daily chart shows the total crypto market cap at $3.23 trillion. Source: TOTAL on TradingView.com
Featured image from DALL-E, chart from TradingView.com
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