$5 Million Pig Butchering” Scheme Disrupted by DOJ & Tether Cooperation

TLDR:

• U.S. DOJ seized nearly $5 million in USDT from a “pig butchering” crypto investment scam
• Tether assisted authorities by freezing multiple wallets associated with the fraud
• The scam involved creating fake romantic relationships to trick victims into fraudulent investments
• FBI agents traced funds through various crypto wallets to identify the stolen assets
• Tether has helped redistribute over $108.8 million USDT from illegal operations since 2014

The U.S. Department of Justice (DOJ) has announced the seizure of nearly $5 million worth of Tether (USDT) linked to a cryptocurrency investment scam known as “pig butchering.”

This operation marks a victory in the ongoing battle against cyber-enabled fraud, with stablecoin issuer Tether playing a crucial role in assisting law enforcement.

The scam, which has become increasingly prevalent, involves criminals establishing fake romantic relationships with victims to gain their trust.

Once a connection is established, the scammers introduce their targets to fictitious cryptocurrency trading platforms that mimic legitimate ones.

These platforms display false investment portfolios with abnormally high returns, enticing victims to invest more money.

FBI agents and analysts were able to trace the stolen funds through various cryptocurrency wallets allegedly used to launder the proceeds.

Tether’s assistance proved invaluable in the investigation, as the company froze multiple wallets associated with the fraud, facilitating the successful seizure and forfeiture of the stolen funds.

U.S. Attorney Michael Easley commented on the case, stating,

“Americans are losing their life’s savings to investment frauds as funds are being rapidly transferred to cryptocurrency accounts overseas. We are clawing back every dollar we can, even when criminals are located abroad. We are determined to seize their illegal proceeds and return money to the victims.”

Tether CEO Paolo Ardoino reaffirmed the company’s commitment to combating illicit activities, saying,

“We unequivocally condemn the misuse of USDT or any cryptocurrency for criminal activities. We are fully dedicated to our continued collaborative efforts with law enforcement to combat fraud.”

This recent seizure is part of Tether’s broader efforts to support global law enforcement. Since its inception in 2014, the company has assisted more than 145 enforcement agencies across 40 jurisdictions.

Tether has helped redistribute over $108.8 million in USDT to rightful owners and law enforcement, and has voluntarily blocked over 1,900 wallets connected to illicit activities.

The DOJ’s press release highlighted the sophisticated nature of these scams, explaining that once victims attempt to withdraw funds, they are often met with various excuses, including being told they must pay “taxes” or “penalties” to release their funds. This tactic is designed to extract even more money from the victims.

To combat the evolving landscape of cyber-enabled fraud, Tether has integrated the FBI and the United States Secret Service into its platform to enhance investigative synergies.

FBI Charlotte Special Agent in Charge Robert M. DeWitt emphasized the need for law enforcement to adapt to changing criminal tactics, stating,

“This cryptocurrency seizure serves as an example of the FBI adapting to the changing criminal landscape and fighting for victims of cyber-enabled fraud schemes.”

The DOJ has encouraged victims of cryptocurrency scams or other internet-based fraud to file reports with the Internet Crime Complaint Center (IC3) at ic3.gov and with the Federal Trade Commission at reportfraud.ftc.gov.