The Justice Department has announced the seizure of approximately $9 million worth of Tether tokens linked to an organization involved in romance scams. The organization, which remains unnamed, exploited over 70 victims through “pig butchering” scams on fake cryptocurrency trading platforms. These scams involve scammers establishing fake romantic or personal relationships with victims, convincing them to send money for investment purposes. However, the scammers fabricate investment gains and disappear with the funds. The Financial Crimes Enforcement Network has provided details on this type of scam.
The Secret Service, in its investigation, traced the victims’ deposits and discovered that the funds were quickly laundered through numerous cryptocurrency addresses and other tokens using a process known as “chain hopping.” Tether Holdings, the cryptocurrency firm, froze approximately $225 million worth of its token earlier this month as part of the ongoing investigation into an international human trafficking syndicate in Southeast Asia. It is unclear at this time whether the frozen tokens are connected to the seized funds.
The Financial Crimes Enforcement Network has previously issued an alert regarding “pig butchering” scams, highlighting that victims in the United States have lost billions of dollars to these schemes. The scams are predominantly orchestrated by criminal organizations in Southeast Asia, who exploit victims of labor trafficking to target unsuspecting individuals worldwide.
Tether Holdings has not yet provided a comment on the matter.