In a recent development, the United States Attorney’s Office in Massachusetts has taken legal action to reclaim $2.3 million in crypto assets and return it to 37 victims who fell prey to online scams and fraud. 

The civil forfeiture action aims to forfeit various cryptocurrencies, including Circle’s USD Coin (USDC), Tether (USDT), Tron (TRX), Solana (SOL), Binance Coin (BNB), Cardano (ADA), and Ethereum (ETH), seized from two accounts held at Binance. The cryptocurrency’s estimated current value is approximately $2.3 million.

The investigation into a “pig butchering” fraud scheme began in the spring of 2023, targeting a resident of Massachusetts. In this scam, perpetrators manipulate victims into providing funds by establishing trust through online communication and enticing them to invest in fraudulent crypto schemes. 

Often, victims are tricked into making additional payments before they realize they have been scammed. The term “butchering” or “slaughtering” refers to the act of criminals stealing the victim’s assets or funds, causing “significant financial and emotional harm.” The Attorney’s Office leading the investigation also noted that perpetrators of such schemes are typically located overseas.

According to court documents, a Massachusetts resident became a romance scam victim and was deceived into wiring over $400,000 into a cryptocurrency wallet hosted by a legitimate exchange. Some of these funds were transferred to other wallets and eventually ended up in Binance. 

In January 2024, the cryptocurrency associated with the fraud scheme was seized from two Binance accounts. The investigation revealed that these accounts were linked to funds from an additional 36 victims of fraud across the United States.

The complaint further alleges that the cryptocurrency represents proceeds from wire fraud, money laundering, and other illicit activities, making it subject to forfeiture. 

The United States Attorney’s Office for the District of Massachusetts also notes that using wire communications as part of a fraudulent scheme or obtaining money or property by false or fraudulent pretenses violates federal law. Similarly, it is a federal crime to conduct or attempt to conduct financial transactions involving the proceeds of unlawful activity. 

The US Attorney’s Office’s legal action seeks to provide restitution to the victims affected by this “pig butchering” fraud scheme. By recovering the seized cryptocurrency, the aim is to compensate the victims and disrupt the illicit activities of the perpetrators. 

As of this writing, the total crypto market capitalization is $2.6 trillion, representing a decline of 1.27% over the past 24 hours. 

Featured image from Shutterstock, chart from TradingView.com

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