DOJ seizes nearly $9 million in crypto 'pig butchering' and romance scams
The Department of Justice announced Tuesday it has seized nearly $9 million worth of cryptocurrency from alleged bad actors who swindled at least 70 people across the country in so-called romance and pig butchering scams.
The online grifts were carried out by offshore criminals who befriended victims via text message. Once they had their marks on the line, they convinced them to invest thousands of dollars in phony crypto companies. At first, they made it seem like the new investors had made some money, but then they quickly vanished with the bulk of the investment.
Cyber swindlers often target the elderly or those with disposable cash, leaving them emotionally and financially shaken by the end of the ordeal.
“Through this significant seizure, we disrupted the financial infrastructure of an organized network of scammers who stole millions from victims across the United States," acting Assistant Attorney General Nicole M. Argentieri of the Justice Department’s Criminal Division said in a written statement. "These scammers prey on ordinary investors by creating websites that tell victims their investments are working to make them money. The truth is that these international criminal actors are simply stealing cryptocurrency and leaving victims with nothing."
Agents and analysts with the Secret Service were able to trace victim deposits and piece together that their money was being laundered through dozens of cryptocurrency addresses and exchanged for several different cryptocurrencies in a process known as "chain hopping," which allows criminals to hide the source of the funds easily and who possesses them.
“This seizure is the culmination of the exceptional hard work and collaborative partnership between the Justice Department and the United States Secret Service,” said U.S. Attorney Ismail J. Ramsey for the Northern District of California. “Silicon Valley remains one of the world’s preeminent locations for cryptocurrency firms. As such, we remain dedicated to using all tools at our disposal to bring justice to the victims of frauds and scams. Even when money and criminals are abroad, we will work with our partners to seize cyber criminals’ illegal proceeds.”
The United States has come down hard on the largely unregulated crypto industry lately. Federal prosecutors won a case earlier this month against Sam Bankman-Fried , the founder of the cryptocurrency exchange FTX , who stole $8 billion from customers in what is believed to be one of the largest financial frauds in U.S. history.
