Crypto Scam: Feds Seize $112 Million Related to Digital Asset Con Job, Targets Were Enticed to Make Investments on Fake Crypto Exchanges


Crypto Con: “Sha Zhu Pan” or pig butchering in Chinese

Fraudsters and crooks tend to rehash their scams over time; the only thing that changes is the technology and tools utilized to separate money from the unsuspecting. Yesterday, the US Department of Justice (DOJ) announced another really big crypto scam, with the Feds seizing over $112 million in digital assets linked to criminal activity.

According to the DOJ, seizure warrants for six virtual currency accounts were authorized by judges in the District of Arizona, the Central District of California, and the District of Idaho.

Allegedly these crypto wallets were used to launder the proceeds of crypto confidence scams.

The trap involved befriending individuals online and, over time, luring them to make crypto investments on bogus crypto exchanges – made to look like the real thing.

After a purported investment, the platform makes it look like the target has generated gains – at times they are able to withdraw some funds. But after trust is established, largest investments are made, the trap is set. The crooks may even request additional funds to cover taxes or fees that will then allow the funds to be retrieved.

Unfortunately for the marks, the funds were sent to accounts controlled by the perps and their partners in crime.  The various accounts were used to launder the digital assets.

The DOM noted that in 2022, investment fraud caused the highest losses of any scam reported by the public, totaling $3.31 billion. Crypto scams jumped by 183% from 2021 to $2.57 billion in 2022 – making crypto the favored path for financial fraud. Most of the reported victims were aged from 30 to 49.

The Feds said the scams are frequently called “Sha Zhu Pan” or pig butchering in Chinese.

Assistant Attorney General Kenneth A. Polite, Jr. of the Justice Department’s Criminal Division, says these cons are proliferated by transnational criminal organizations using tech-savvy.

“These particularly vicious frauds – where scammers carefully cultivate relationships with their victims over time – have devastated families and cost individuals their life savings. Now that we have seized this virtual currency, we will seek to swiftly return it to victims. In addition to our tireless efforts to disrupt these schemes, we must also work to raise public awareness and help inform potential victims: be wary of people you meet online; seriously question investment advice, especially about cryptocurrency, from people you have not met in person; and remember, investments that seem too good to be true, usually are.”

Director Eun Young Choi of the Criminal Division’s National Cryptocurrency Enforcement Team (NCET) said they will continue to use all of their tools to take down these scams while thanking individuals who were willing to come forward and notify the FBI.

FBI Assistant Director Luis Quesada stated:

“We continue to see these schemes evolve and provide new avenues for criminals to exploit. Today’s announcement should serve as reminder of the FBI’s unwavering commitment, alongside our federal and international law enforcement partners, to investigating and pursuing criminal actors who seek to defraud the American public. There is no place beyond the reach of the FBI.”

The FBI Phoenix Division is investigating this case.

Editors Note: If you or someone you know is a victim, visit , contact your local FBI field office, call 1-800-CALL-FBI, or report it to the In your complaint, please reference “Pig Butchering PSA.”

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