Tether helps the US Department of Justice seize 6 million USDT from crypto fraudsters

A scheme to steal funds from US citizens under the pretext of crypto investing was realized by a group from Southeast Asia

27.09.2024 - 08:50

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3 min

Last updated on Nov 16, 2024

What’s new? The US Department of Justice has thanked the issuer of the largest centralized stablecoin USDT Tether for helping to seize $6 million from a Southeast Asian group that was running an investment scam targeting US citizens. The press release notes that FBI agents conducted an on-chain analysis and discovered the scammers’ cryptocurrency wallets holding USDT.

Press release

What else is known? As part of the scam itself, the scammers used social engineering to gain the trust of victims by posing as successful crypto investors. After that, the scammers recommended victims also invest in digital assets by sending links to fake platforms under their control.

It is noted that the scammers help victims to open an account on the US crypto exchange, and then transfer funds to the fake investment platform.

In the early stages of the scheme, attackers often allow victims to withdraw part of their alleged profits to build confidence that the platform is legitimate. However, users are then prevented from withdrawing the rest under various pretexts, and then their accounts are blocked, stealing funds.

According to the FBI, in 2022 alone, tens of thousands of US citizens lost more than $3,8 billion as a result of such crypto affairs, which were subsequently withdrawn abroad. In 2023, the losses increased by 45% to $5,6 billion.

Consumers’ Research compared the USDT issuer to the FTX exchange for its lack of transparency

The NPO recalled that the company, despite numerous promises, never published a report on the stablecoin’s reserves

As for Tether, the company has previously assisted law enforcement on multiple occasions in freezing cryptocurrency linked to illegal activity. Last month, CEO Paolo Ardoino said that with the company’s help, $109 million in USDT has been recovered throughout its operations.

The company has also begun monitoring the asset’s secondary market on its own to combat illegal transactions and has planned to double its staff to strengthen compliance.

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