We are proud to work closely with the USSS on our extensive investigation into crypto fraud schemes. Using social engineering techniques, fraudsters have built trust with their victims over time, an approach commonly known as “pig slaughter.” This joint effort has resulted in the largest USSS code attack, bringing it to approximately $225 million in total.
The USSS investigation targeted sophisticated scams that prey on individuals and invited them to fake cryptocurrency investments. Victims of the pig slaughter scheme are encouraged to deposit gradually increasing amounts, but only discover that their funds have been stolen in the end.
The $225 million in question was first frozen by Tether in 2023 after being linked to pig slaughter in a US Department of Justice investigation. The stolen funds were tied to the perpetrator’s accounts in a non-craked central exchange. Identifying victims and returning funds presented challenges and required considerable knowledge of blockchain analysis.
In March 2024, we joined several cryptocurrency exchanges in an intensive week of law enforcement sprint. Compliance and research teams provided rapid, real-time response to critical information requests, and timely provision of transaction and account information helped identify nearly 500 victims. This directly assisted the USSS in obtaining an unprecedented $225 million forfeiture seizure warrant for stolen funds.
We are dedicated to working with law enforcement to protect our cryptocurrency ecosystem. Our fast response approach and meticulous record keeping reflects our continued commitment to security, transparency and protection. They also have strict policies and procedures to protect the privacy of our clients, whilst providing data when there is a legal obligation.
We continue to actively participate in efforts aimed at identifying and suspending fraud, helping victims recover, and maintaining trust within the crypto community.
“Protecting our clients is our number one priority and we are proud to support our efforts to lead to this historic recovery of stolen funds. Our strict compliance practices, cutting-edge security protocols and on-chain research capabilities reflect our deep commitment to protecting our clients’ assets and maintaining confidence in cryptographic areas. Kraken Deputy Chief Compliance Director.
If you believe you are a victim of cryptocurrency fraud, we recommend reporting your case to your local authorities and the FBI Internet Crime Complaint Center at https://www.ic3.gov/. Your prompt reporting will help prevent future fraud.
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