The U.S. Department of Justice has filed a civil complaint seeking to seize $225.3 million in cryptocurrency allegedly obtained through pig butchering scams — a form of long-running confidence fraud that tricks victims into believing they are investing in profitable crypto opportunities before vanishing with their funds. The complaint, filed in the U.S. District Court for the District of Columbia, outlines how the funds were laundered through a blockchain network and emphasizes that the recovered money will be used to reimburse victims. The DOJ alleges the scam ring trafficked workers from Southeast Asian countries, with the fraud falling under the broader category of ‘pig butchering’ scams.
The complaint details how the U.S. Secret Service and FBI tied the scammers to seven groups of Tether stablecoin tokens, with the fraud involving complex transactions that were first flagged by Tether and crypto exchange OKX in 2023. Among the alleged victims included in the complaint is Shan Hanes, the former Heartland Tri-State Bank president who was sentenced to 24 years in prison for embezzling tens of millions of dollars into a notorious pig butchering scam. An FBI report cited in the press release estimates that crypto investment fraud caused $5.8 billion in reported losses in 2024.
Federal law enforcement agencies have increasingly targeted crypto-related fraud in recent years, as the anonymity and borderless nature of digital currencies make them a preferred tool for scammers. This case highlights the challenges of tracing and recovering illicit funds, particularly when they are moved through a vast and complex network of transactions. The DOJ’s action aims not only to recover the stolen funds but also to send a message to potential scammers that law enforcement is actively monitoring and taking action against crypto-based fraud schemes. The use of stablecoins like Tether in such schemes underscores the growing role of these assets in both legitimate and illicit financial activities. As the financial landscape continues to evolve, the intersection of regulation, technology, and criminal activity remains a critical area of public concern.