Over $6M in Crypto from SE Asia Scam Targeting US Investors

The newest FBI seizure resulted in over $6 million in crypto paid by American citizens after a scam operating out of Southeast Asia.

According to the FBI announcement on September 26, fraudsters created the impression among victims that they were investing in actual projects, which, over time, seriously hurt the people involved in the transactions.

FBI’s Yarbrough: Crypto Scams ‘Devastating’ to US, Millions Lost

Assistant Director Chad Yarbrough of the FBI’s Criminal Investigative Division told reporters that such crypto fraud schemes have disastrous impacts on Americans, underlining how important continued efforts are to stop these schemes that affect United States citizens. He also added that this FBI seizure is one of the largest in this year.

This incident epitomizes the growing challenges in fighting fraud related to cryptocurrencies in an ever-increasingly globalized market.

Yarbourgh commented in a press release:

“These types of schemes are devastating, and they’re impacting thousands of Americans every day. The FBI has seen victims lose millions of dollars, take second and third mortgages on their homes, all in the hopes of finding the next big investment opportunity.”

Newest FBI Seizure Exposes ‘Pig Butchering’ Scam

According to the FBI, the victims of this kind of scam were tricked into taking cash out from their bank accounts and putting it into crypto wallets, then onto fraudulent offshore platforms. In an effort to gain targets’ trust, con artists granted limited withdrawals early in the process.

A little later, however, victims were cut off from their accounts altogether and lost their entire investments. The practice is more commonly known as “pig butchering,” and it involves baiting and switching a victim.

FBI seizure of this kind isn’t something new. It said that this kind of scam is now a threat in the rising cryptocurrency space, when an asset seizure depends on a gradual, sustained build-up of trust.

‘Pig Butchering’ Crypto Fraud Targets 12% of US Daters

Otherwise known as Sha Zhu Pan, “Pig Butchering” is a long-term investment fraud wherein the victim is slowly and persistently coaxed into making investments of higher and higher values using cryptocurrency. This could be a blend of trust over time, usually on social or dating apps, before “slaughtering” them, meaning, stealing from them once there has been an investment worth mentioning.

This type of scam emerged in China around 2016 and then continued to spread throughout Southeast Asia, especially during the COVID-19 pandemic. It is not uncommon that the perpetrators themselves are victims previously trafficked by organized crime groups and forced to perform the fraud.

The fraud schemes have become even more widespread, with one October 2023 report indicating that 12% of Americans using dating apps said they had been victimized, which compares with 5% in 2018.

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Teuta

Teuta is a seasoned writer and editor with over 15 years of experience in macroeconomics, technology, and the cryptocurrency and blockchain industries. Starting her career in 2005 as a lifestyle writer for Cosmopolitan in Croatia, she expanded into covering business and economy for several esteemed publications like Forbes and Bloomberg. Influenced by figures like Don Tapscott and Bruce Dickinson, Teuta embraced the blockchain revolution, believing crypto to be one of humanity’s most crucial inventions. Her fintech involvement began in 2014, focusing on crypto, blockchain, NFTs, and Web3. Known for her excellent teamwork and communication skills, Teuta holds a double MA in Political Science and Law, enjoys punk rock, chablis, and has a passion for shoes.

Disclaimer: The presented content may include the personal opinion of the author and is subject to market condition. Do your market research before investing in cryptocurrencies. The author or the publication does not hold any responsibility for your personal financial loss.