Seizure of nearly $9 million of Tether cryptocurrency was undertaken by the U.S. Justice Department. This action was executed as a response to an organized network exploiting victims through fraudulent investment scams.
The unfolding story behind this seizure provides important details into the operation. The Justice Department has seized nearly $9 million worth of Tether, a cryptocurrency pegged to the U.S. dollar, according to a press release by the Department. The crypto is linked to an organization that exploited over 70 victims through romance scams and confidence scams, known as "pig butchering." The criminal actors worked together to target victims and convince them to make cryptocurrency deposits by fraudulently representing investments with trusted firms and exchanges. The funds were then laundered through dozens of cryptocurrency addresses and exchanged for several different cryptocurrencies, a money laundering technique known as "chain hopping." The seized funds were linked to numerous victim reports made via the FBI's Internet Crime Complaint Center (IC3) and the Federal Trade Commission's (FTC) Consumer Sentinel Network.
Expressing strong condemnation for these illicit activities, senior officials spoke out on their impact. "Through this significant seizure, we disrupted the financial infrastructure of an organized network of scammers who stole millions from victims across the United States. 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," said Acting Assistant Attorney General Nicole M. Argentieri of the Justice Department’s Criminal Division in the press release. "The department hopes this recovery of assets will bring some closure and a sense of justice to the over 70 victims affected by this series of scams. This seizure should also serve as a reminder to cybercriminals that, although the current landscape of the cryptocurrency ecosystem may seem like an ideal way to launder ill-gotten gains, law enforcement will continue to develop the expertise needed to follow the money and seize it back for victims."
Putting this recent action into a broader context highlights a trend in U.S. government interventions. According to a news article from cointelegraph.com, the US government has previously used its authority to seize illicit funds linked to crypto-related scams and crimes, such as controlling 70,000 Bitcoin linked to Silk Road in 2020. In November, the Justice Department announced significant cryptocurrency enforcement actions in coordination with the US Treasury and Commodity Futures Trading Commission, with speculation suggesting the announcement referred to a $4-billion settlement with Binance, in which Changpeng Zhao plans to step down.
