The Justice Department has filed a civil forfeiture complaint against $848,247 in Tether (USDT), a type of cryptocurrency. According to the complaint, this money was gained through a series of scams that tricked victims across the United States, including people in Washington, D.C., Texas, Illinois, Florida, and Hawaii.
The announcement was made by U.S. Attorney Jeanine Ferris Pirro, joined by Acting Assistant Attorney General Matthew R. Galeotti of the Justice Department’s Criminal Division, and Special Agent in Charge David K. Porter of the FBI Honolulu Field Office.
Investigators say the fraud ran between September 2022 and February 2025. The scams involved groups of criminals who used online tricks to gain the trust of victims. Once trust was established, the victims were guided into investing money in what they believed were safe cryptocurrency trading platforms. In reality, these platforms were fake and controlled by the criminals.
The stolen funds were then moved through many different cryptocurrency wallets in an attempt to hide the true source and ownership. This process, often called “laundering”, was designed to make the money hard to trace and to avoid accountability.
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How the Crypto Scam Worked
The complaint explains that the criminals often began their schemes with a simple misdirected text message. For example, they would send a casual “wrong number” message to someone. Once the person replied, the scammer would start building a conversation. Over time, these conversations turned into long-term online relationships.
Through manipulation, the fraudsters convinced the victims to believe they were knowledgeable investors in cryptocurrency. They would brag about their own success and then invite the victims to join them in “special” opportunities.
Victims were guided step by step through the investment process. First, they were told to create a cryptocurrency account, often on a well-known U.S.-based exchange. Next, they were shown how to move money from their bank into that account. Finally, they were directed to transfer their crypto into what looked like an investment platform. But these platforms were nothing more than fake websites that mimicked real financial platforms.
On the screen, these fake apps would display large profits and growing balances. Sometimes, victims were even allowed to withdraw small amounts of “profit” early on. This tactic helped convince them that the system was real and safe. Encouraged by these fake earnings, victims often invested even more money.
But the truth was very different. In reality, all the funds were being funneled into wallets controlled by the scammers. When the victims later tried to withdraw their investments, they were given excuses. Eventually, their accounts were locked, and they lost everything.
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One victim in Washington, D.C., reported a $30,000 loss to the FBI’s Internet Crime Complaint Center in December 2023. The victim admitted they thought the scheme was a chance to make “big profits in a short time.” Another victim in Hawaii was tricked into investing a staggering $1.3 million through a scam group impersonating the London Metal Exchange. That case was first reported to the FBI Honolulu Division Cyber Squad, which later expanded the investigation.
Scale of the Problem and Ongoing Action
The Justice Department emphasized that these scams are part of a much larger problem. In 2024 alone, the FBI’s Internet Crime Complaint Center received reports of around $5.8 billion in losses from cryptocurrency investment fraud. These crimes often combine elements of romance scams, investment fraud, and online manipulation.
The FBI’s Honolulu Field Office led the investigation, with support from the Justice Department’s Office of International Affairs and the FBI’s Virtual Asset Unit. The department also acknowledged Tether, the company behind the USDT cryptocurrency, for assisting in the recovery of the funds.
The case is being prosecuted by Assistant U.S. Attorneys Kevin Rosenberg (Acting Deputy Chief) and Rick Blaylock Jr. (Asset Forfeiture Coordinator), along with Trial Attorneys Stefanie Schwartz, Ethan Cantor, and Gaelin Bernstein from the Computer Crime and Intellectual Property Section of the Department of Justice, and Daniel Zytnick of the DOJ’s Consumer Protection Branch.
The $848,247 now being targeted through the civil forfeiture complaint represents just one piece of the money that has been stolen from victims. The Justice Department has stated that the case highlights how criminals are exploiting digital currencies and online platforms to take advantage of unsuspecting people.