Key Takeaways
- FBI revealed that the scammers lured victims by convincing them to move money from traditional bank accounts into crypto wallets
- Tether assisted in recovering the stolen funds by freezing the scammers’ wallets
On September 26, the FBI announced the seizure of over $6 million in cryptocurrency from a group of Southeast Asia-based scammers who defrauded U.S. citizens through deceptive investment schemes. These fraudsters lured victims into thinking they were investing in legitimate cryptocurrency opportunities, only for their assets to be transferred to fraudulent platforms overseas.
The FBI revealed that the scammers lured victims by convincing them to move money from traditional bank accounts into crypto wallets. Initially, some victims were allowed to make withdrawals in order to build trust. However, over time, the scammers locked them out of the accounts, leading to significant financial losses.
“These types of schemes are devastating, and they’re impacting thousands of Americans every day,” said Chad Yarbrough, Assistant Director of the FBI’s Criminal Investigative Division. He noted that victims often took out additional loans, including second and third mortgages, in the hope of cashing in on the “next big investment opportunity.”
The investigation, which involved tracking transactions on the blockchain, identified multiple cryptocurrency wallets holding over $6 million. The FBI, joined hands with the Justice Department’s Office of International Affairs and its Virtual Asset Unit, to seize these funds. Leading crypto firm Tether assisted in recovering the stolen funds by freezing the scammers’ wallets, which later the FBI seized.
U.S. Attorney Matthew Graves for the District of Columbia highlighted the challenges of tracking and recovering assets from fraudsters who are often located outside the U.S. “These fraudsters may be operating abroad, but that won’t stop us or our partners at the FBI from working to recover the stolen funds,” he stated.
The U.S. Attorney’s Office detailed that the scammers often targeted victims through a variety of methods, including dating apps, misdirected text messages, and investment forums. Once trust was established, victims were led to fraudulent websites that mimicked legitimate crypto investment platforms.
According to the FBI’s Internet Crime Complaint Center (IC3), these schemes have grown significantly. In 2022 alone, tens of thousands of Americans were affected, losing over $2 billion to crypto scams. The centre also reported a sharp increase in losses related to cryptocurrency, with the amount stolen rising by 45% from 2022 to 2023—totalling over $5.6 billion this year.
Special Agent Joseph Carrico from the FBI’s Knoxville Division urged individuals to be cautious when making investments, particularly in the cryptocurrency space. “The best defence is to educate yourself before putting your money into any investment,” he advised.
A recent UK National Crime Agency report revealed that around $5.1 billion in illicit crypto transactions are linked to the UK annually. Similarly, Brazilian authorities recently seized $28.7 million worth of cryptocurrency in an unrelated operation.
