Seattle-based federal prosecutors are seeking the $7.1 million confiscation of custody cryptocurrency value related to oil and gas fraud between June 2022 and July 2024. The US lawyer’s firm claimed it brought $97 million from investors by promoting a fake business model that includes storage rentals for oil tanks.
In December 2024, Homeland Security seized $7.1 million. Prosecutors are now trying to distribute money to legitimate victims.
“Federal investigators and prosecutors in our office moved as quickly as possible to track and seize cryptocurrencies so that some of the losses could be returned to the victims.”
~US Attorney Teal Luthy Miller
Scams are said to be international, with criminals in Russia and Nigeria turning victims’ cash into encryption and concentrating it through domestic interactions. Representing attorney Thiel Lucy Miller said the fraud party created several crypto accounts to hide the transfer of funds, a classic laundry strategy to avoid detection.
The main suspect used vinance for cryptographic transfers
At least one person is said to have supported money laundering activities by cross-border criminal groups. Geoffrey Auyeung was charged in August 2024 with a core to stolen funds for laundering. According to court records, he used the stolen funds to buy Bitcoin, Ether, USDT and USDC, moving most of the total to Binance. At the time of his arrest, $2.3 million was confiscated in his US account.
According to the Justice Department, Auyeung and his co-conspirators appealed to a genuine investment manager who provided great benefits for oil tank lease activities. Upon raising funds, they shut down communications with investors. So far, prosecutors have found more than $17.9 million in direct losses, but more victims are expected to emerge as the investigation process progresses.
DOJ strengthens crypto fraud enforcement
The Seattle case is part of a broader crackdown by US authorities on crypto-related financial crimes. A recent court filing revealed that DOJ seized $2 million on USDT and Binance-based assets related to Hamas. Investigators tracked the funds through a Gaza-based remittance business known as BuyCash.
Other fraud cases are also in the spotlight. Former rugby player Shane Donovan Moore was sentenced in federal prison for two and a half years after running the Ponzi project using a crypto mining company as a fake front. Between 2021 and 2022, Moore scams over 40 investors, nearly $900,000, through his Quantum Donovan LLC.
In another case, the Denver-based pastor and his wife face 40 criminal charges over a faith-based crypto-based investment scheme that has taken over more than $3 million. The indictment cites the ongoing abuse of trust-based networks when seeking crypto funds.
Digital asset fraud is on the rise, according to FBI data. The victim’s losses reached $4 billion in 2023 compared to $2.57 billion in 2022, and $4 billion in 2024. This number rose to $5.8 billion in 2024.
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