- The Department of Justice has seized $112 million worth of crypto related to pig butchering scams
- The DoJ seized the funds from six accounts after the origin of the funds in them derived from wire fraud
- Warnings over pig butchering scams have been on the rise in the last year or so
The Department of Justice (DoJ) yesterday announced the seizure of around $112 million worth of cryptocurrencies associated with investment scams commonly known as pig butchering. Six crypto accounts were subject to seizure warrants issued by judges in the District of Arizona, Los Angeles, and the District of Idaho, with the LA magistrate judge granting permission to seize an account containing various cryptocurrencies worth roughly $66.4 million after establishing probable cause that the funds originated from wire fraud schemes.
Funds Transferred as Late as March 2023
The DoJ acted after six cryptocurrency accounts were discovered to have been utilized to launder money gained from a variety of cryptocurrency scams. According to court records, scammers established long-term, online relationships with victims in these schemes, ultimately persuading them to invest in fraudulent cryptocurrency trading platforms. However, instead of sending funds to the supposed investment platforms, the scammers and their co-conspirators funneled the money to cryptocurrency accounts and addresses they controlled.
The FBI identified at least ten victims who were unable to retrieve funds they had invested in relation to the Los Angeles-based account seizure, with the seized account containing some funds from all ten victims. This seizure warrant was executed in December, with the last transfer of cryptocurrency being received on March 21.
One Victim Lost $2.5 Million
The affidavit included in the Los Angeles seizure warrant outlined a range of cryptocurrency investment scams, including one that targeted a professional woman contacted through LinkedIn by an individual using the name “Fei Kuang.” After discovering that the victim had a small cryptocurrency account, “Fei Kuang” offered assistance, ultimately persuading her to invest additional funds and transfer her money to another, presumably fraudulent, trading platform.
When the woman attempted to withdraw her funds, she was informed that she needed to pay a 20% “tax.” As the trading platform continued to demand more money, the woman realized she had fallen prey to a scam that resulted in a loss of around $2.5 million.
Pig butchering scams have risen up the agenda for law enforcement agencies in recent months as the practice has become more and more widespread and sophisticated.
