The U.S. Department of Justice (DOJ) announced that it has seized over $112 million in cryptocurrency associated with a fraudulent investment scheme known as “pig butchering.” According to court documents, the DOJ alleges that the seized crypto accounts “were used to launder the proceeds of various cryptocurrency confidence scams.”
$112 Million in Crypto Seized by DOJ
The U.S. Department of Justice (DOJ) announced Monday that it has seized “more than $112 million in cryptocurrency related to cryptocurrency investment fraud.” Noting that the Phoenix Division of the Federal Bureau of Investigation (FBI) is investigating the matter, the announcement detailed:
Seizure warrants for six virtual currency accounts were granted by judges in Arizona, the Central District of California, and Idaho.
“According to court documents, the virtual currency accounts were allegedly used to launder the proceeds of various cryptocurrency confidence scams.” DOJ stated.
The announcement describes a “pig slaughter” scheme in which scammers often target victims through “social networking and online communication platforms, dating sites, and phone calls and text messages disguised as false calls.” After gaining the victim’s trust, the scammer introduces the idea of cryptocurrency trading and persuades them to invest in a crypto scheme where funds are redirected to an account they control.
The victim may confirm the apparent profit and withdraw some funds in order to build trust. However, after investing a large amount of money, they are unable to withdraw funds. The scammer may ask for more money for taxes and fees and promise access to the account. This scam continues until the victim’s savings are exhausted.
The Federal Bureau of Investigation’s (FBI) Internet Crime Complaint Center (IC3) recently found that investment fraud accounts for the highest losses among scams, totaling $3.31 billion. The agency noted that cryptocurrency investment fraud increased 183% from $907 million in 2021 to $2.57 billion in 2022.
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