The U.S. Department of Justice’s D.C. office on Wednesday announced an interagency initiative specifically designed to dismantle an international cryptocurrency fraud operation known as the “pig butchering” scheme.
The Fraud Center Strike Force works in conjunction with the Department of Justice, FBI, Secret Service, U.S. Department of the Treasury, and other government agencies to root out transnational criminal networks that have made billions of dollars in recent years by defrauding people around the world by assuming false identities on fake cryptocurrency sites and social media platforms.
The initiative was announced Wednesday by Jeanine Pirro, the U.S. attorney for the District of Columbia. In his remarks, Pirro specifically linked the scourge of online cryptocurrency fraud to organized crime networks in China.
“We are here today to combat the growing epidemic,” Pirro said. “Cryptocurrency investment scams are perpetrated by Chinese criminal organizations and have successfully targeted and harmed Americans.”
Pirro claimed that these schemes likely defrauded Americans of $135 billion in 2024 alone. She said her office has already seized $400 million worth of cryptocurrencies from bad actors, and today will reveal the seizure of another $80 million worth of stolen cryptocurrencies, which the Justice Department is seeking to return to victims.
“The mission of this new Strike Force is to identify and prosecute the leaders of these crypto fraud rings, track and seize stolen funds for their victims, and seize and disable the U.S. infrastructure that is the methods and means of the fraud itself,” Pirro added.
The federal prosecutor also linked the initiative to President Donald Trump’s pro-cryptocurrency policies, arguing that consumers should feel safe trusting cryptocurrencies without fear of fraud when transacting them online as the president urges Americans to embrace the new field.
“There are no tricks that can be part of a cryptocurrency,” Pirro said.
At a press conference on Wednesday, Treasury officials also announced sanctions against extremist groups that operate in cyber fraud facilities in Burma and allegedly inflict violence on human trafficking victims who are forced to work in fraud centers against their will. The Treasury Department also sanctioned two companies and a Thai national for their ties to Burmese armed groups and Chinese organized crime.
Leading cryptocurrency security experts have long argued that the U.S. government is failing to address pig-butchering scams (so-called because scammers slowly build trust with their victims and “bloat” them before stealing their money) with a coordinated, interagency approach.
Rather, agencies such as the Treasury Department and the FBI are focusing on different elements of these crimes without recognizing that there is a common root in the Chinese black market that facilitates most crypto crimes, said experts at blockchain intelligence firm TRM. said decryption At the beginning of this year.
TRM leadership hailed today’s announcement as a much-needed shift in approach for the federal government, allowing the U.S. government to conduct coordinated attacks against global crypto criminal networks rather than piecemeal defenses.
“The Fraud Center Strike Force is the clearest statement yet that the United States intends to fight back with the full force of the nation,” said Ari Redboard, head of global policy at TRM. decryption. “They’re not working in isolation, they’re working together: Justice Department prosecutions, Treasury sanctions, FBI investigations, FinCEN analysis, state pressure, and industry tracking.”
Last month, the Department of Justice $14 billion A significant amount of Bitcoin was leaked from a cryptocurrency fraud network based in Cambodia and believed to have ties to China. The operation was the largest forfeiture case in Department of Justice history and included criminal charges, financial sanctions, diplomatic overtures, and on-chain investigations.
TRM’s Redboard said this action, which involves coordinated action by the Department of Justice, FBI, Drug Enforcement Administration, and State Department, serves as a model for how the Fraud Center Strike Force can work to eradicate crypto crime in the future.
“We have shown that when law enforcement, regulators and intelligence agencies work together, the model for combating cyber-enabled fraud globally can be proactively disruptive, not just reactive,” Redboard said.
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