The FBI investigates a $5 million crypto romance scam, targeting 71 victims through fraudulent investment schemes, highlighting the growing threat of crypto scams.
The FBI is currently investigating a significant crypto romance scam that has defrauded victims of approximately $5 million. This scheme, known as "pig butchering," involves scammers establishing emotional connections with victims before introducing fraudulent investment opportunities, leading to devastating financial losses.
The Federal Bureau of Investigation (FBI) has turned its attention to a group of romance scammers linked to a staggering $5 million in fraudulent cryptocurrency schemes. The investigation, which began in August, has revealed that scammers have targeted approximately 71 victims across the United States, employing a method known as "pig butchering."
In this scheme, scammers establish close relationships with their victims, often feigning romantic interest. They invest time in building trust and emotional bonds before introducing fraudulent investment opportunities, leading victims to believe they are making legitimate investments.
Among the victims are a 60-year-old resident of Angier, North Carolina, and an 83-year-old from Minnesota. These individuals were lured into the scam with promises of lucrative cryptocurrency investments. The scammers directed victims to a fraudulent trading platform called Bitkanant, which was designed to mimic the legitimate Singapore-based exchange, Bitkant.
Once victims transferred their funds, primarily in Tether (USDT), they were informed that their accounts had been frozen. To retrieve their money, they were told to pay additional taxes or fees, but even after complying, their original investments were never returned.
In August, the U.S. Attorney for the Eastern District of North Carolina announced the seizure of nearly $5 million worth of Tether linked to cryptocurrency addresses suspected of laundering illicit proceeds from these scams. U.S. Attorney Michael Easley emphasized the urgency of the situation, stating, "Americans are losing their life’s savings to investment frauds as funds are being rapidly transferred to cryptocurrency accounts overseas."
The funds are currently in the custody of the U.S. Marshals Service while the FBI continues its investigation to identify the key individuals behind the cryptocurrency fraud. The FBI's September report on crypto fraud revealed that losses from such scams exceeded $5.6 billion in 2023 alone, with individuals over 60 being the most affected demographic.
The FBI has long warned about the increasing prevalence of crypto romance scams, particularly those targeting older adults. Recent statistics indicate that a staggering $75 billion has been lost to crypto romance scams between January 2020 and February 2024. The scammers behind the $5 million scheme used fake personas to build rapport and trust, significantly increasing the likelihood of substantial investments from victims.
As the investigation unfolds, it serves as a stark reminder of the ongoing risks associated with cryptocurrency investments and the importance of exercising caution in online interactions. Victims are encouraged to report any suspicious activity to authorities to help combat this growing threat.
