Tether Law Enforcement Support Pushed to Crack Down on Crypto Scam

Key Points:

• Tether helped the U.S. Department of Justice seize over $6 million linked to a crypto scam in Southeast Asia.
• Tether law enforcement support is increasingly enhanced with the freezing of nearly $14 million from confidence scams.

Tether, the company behind the USDT stablecoin in wide usage, has been instrumental in supporting the U.S. Department of Justice’s efforts to seize more than $6 million in assets linked to cryptocurrency fraud.

Read more: Tether Stablecoin USDT Officially Recognized Legal Property Under UK Law

Tether Law Enforcement Support Improved

The operation is the most recent from a confidence scheme based in Southeast Asia and has been part of Tether law enforcement support to combat fraud in the crypto space.

The company, so far, has helped more than 180 enforcement agencies across 45 jurisdictions freeze more than $1.8 billion USDT linked to illicit activities. Throughout the last year, Tether helped recover about $9 million in USDT with the U.S. government of which $5 million was associated with pig butchering scams and $1.4 million from a tech support fraud ring.

The scheme targeting Southeast Asia confidence usually began, as many of the pig-butchering scams do, with victims being contacted through chat apps. The scammers directed them to professional-looking websites offering high returns on cryptocurrency investments. The respective victims were thereafter guided on how to open an account with a legitimate broker and buy USDT.

Tether and Exchanges Target Suspicious Crypto Activity with Blacklisting

Tether law enforcement support has been critical in the seizure of ill-gotten gains. The company itself aided in the seizure of $14 million linked to such scams in the past year and frozen up to $1.8 billion in USDT to prevent further laundering or mixing of stolen assets. As of September 2024, Tether has banned 1,814 addresses associated with illegal activity.

Despite the decentralised nature, USDT is not entirely free from control. Tether is capable of blacklisting suspicious addresses, and some exchanges do not swap tokens that originally come from flagged wallets.

In addition, crypto-related scams are on the rise. Cryptocurrency-related fraud has skyrocketed, with a 45% increase in digital scams since 2022, according to the FBI.

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