All articles tagged with #cryptocurrency fraud
In 2025, scammers stole over $333 million through bitcoin ATM scams in the US, marking a significant increase from previous years, as the popularity of cryptocurrency continues to grow. Authorities are taking action, including lawsuits and calls for stricter regulations, to combat this rising crime.
Caroline Ellison, former CEO of Alameda Research and involved in the FTX fraud scheme, has been moved from federal prison to community confinement, with her projected release date moved up to February 2026, after serving about 11 months of her two-year sentence.
The U.S. has seized over $14 billion in bitcoin and charged Chen Zhi, founder of Cambodian conglomerate Prince Holding Group, with orchestrating a massive cryptocurrency scam involving forced labor, violence, and money laundering, highlighting the scale of Southeast Asia's scam economy and international efforts to combat it.
Chen Zhi, chairman of Prince Group, has been indicted in Brooklyn for operating forced labor compounds in Cambodia involved in cryptocurrency fraud schemes that stole billions globally, with the US seizing approximately $15 billion in cryptocurrency linked to the crimes, marking the largest forfeiture in Department of Justice history.
Chen Zhi, chairman of Prince Group, has been indicted for operating forced-labor scam compounds in Cambodia involved in cryptocurrency fraud schemes, including 'pig butchering' scams that stole billions globally. The U.S. government has also seized approximately 127,271 bitcoin, worth around $15 billion, in connection with these schemes, marking the largest forfeiture in Department of Justice history. The case highlights extensive transnational criminal activity involving human trafficking, cyber fraud, and money laundering.
Do Kwon, the creator of the Luna and TerraUSD cryptocurrencies that collapsed in 2022 causing a $300 billion market crash, pleaded guilty to fraud charges in New York, admitting to misleading investors and facing potential up to 12 years in prison as part of a plea deal.
The U.S. Department of Justice has seized $225.3 million in USDT linked to large-scale crypto investment scams involving a sophisticated money laundering network, marking the largest civil forfeiture of digital assets in U.S. history. Tether collaborated with authorities to combat fraud, and the seized funds will be used to compensate over 400 victims. The case highlights increasing crypto scams and efforts to improve compliance and security in digital assets.
FTX co-founder Gary Wang received no prison sentence for his role in the cryptocurrency fraud involving FTX, after cooperating extensively with prosecutors against Sam Bankman-Fried. Wang, who served as FTX's chief technology officer, was praised for his cooperation, which helped expedite Bankman-Fried's extradition and conviction. Despite his involvement, Wang was deemed to have limited culpability and has been actively assisting in recovering funds for victims.
A jury in Manhattan found Terraform Labs and its founder Do Kwon liable on civil fraud charges brought by the SEC, alleging that they misled investors about the stability of TerraUSD, a stablecoin, and falsely claimed that Terraform’s blockchain was used in a popular Korean mobile payment app. The SEC estimates investors lost over $40 billion when the TerraUSD peg to the dollar could not be maintained in May 2022, leading to wider havoc in the crypto market and several companies filing for bankruptcy. Kwon, who was arrested in Montenegro in March 2023, did not attend the trial, and both the US and South Korea have sought his extradition on criminal charges.
A jury in Manhattan found former crypto CEO Do Kwon and his firm Terraform Labs liable on civil fraud charges, agreeing with the US SEC that they misled investors before the 2022 collapse of their cryptocurrency, causing widespread market havoc. Kwon, who has been detained in Montenegro since March 2023, faces extradition requests from both the US and South Korea. The SEC seeks civil financial penalties and orders barring Kwon and Terraform from the securities industry. The collapse of TerraUSD and Luna tokens led to over $40bn in investor losses and bankruptcy filings, prompting US financial regulators to crack down on shady crypto practices.
Sam Bankman-Fried, the founder of FTX cryptocurrency exchange, faces sentencing on Thursday after being found guilty of orchestrating a multibillion-dollar fraud that led to the exchange's collapse. Prosecutors are seeking up to 50 years in prison, citing his brazen disrespect for the law and lack of remorse. Bankman-Fried's defense team is asking for 6 1/2 years or less, citing his mental health struggles and purported selflessness. The judge's decision is likely to be influenced by Bankman-Fried's lack of remorse and the scale of the fraud.
Federal prosecutors are seeking a 40 to 50-year prison sentence for cryptocurrency mogul Sam Bankman-Fried, who they say defrauded over 1 million victims of more than $8 billion through wire fraud, conspiracy to commit fraud, and conspiracy to commit money laundering in connection with his oversight of FTX. Bankman-Fried's attorneys are requesting a five- to six-year prison term, citing his charitable work and autism, while prosecutors argue that he led a life of "unmatched greed and hubris" and is unrepentant. The sentencing is scheduled for March 28.
The FBI reported a record $12.5 billion in losses from online scams in 2023, with over a third attributed to investment scams, particularly those involving fraudulent cryptocurrency schemes. The report also highlighted the increasing costs of ransomware attacks, which jumped from $34 million in 2022 to about $59 million in 2023, although the total financial impact is much higher. Cybercriminals extorted a record $1.1 billion in ransom payments from victim organizations worldwide last year, with the health care sector reporting the highest number of ransomware incidents.
New York Attorney General Letitia James has expanded her lawsuit against Digital Currency Group and others, alleging a fraud scheme exceeding $3 billion, tripling the initial claim. The lawsuit involves the Winklevoss twins' Gemini Trust and their Genesis Global Capital unit, accused of misleading investors about the Gemini Earn program. James seeks over $3 billion in restitution for more than 230,000 defrauded investors, emphasizing the need for stronger cryptocurrency regulations. The defendants, including DCG, Genesis, and Gemini, have faced legal actions from multiple parties, with Genesis filing for bankruptcy and agreeing to a $21 million SEC fine.
New York Attorney General Letitia James has expanded the fraud lawsuit against Digital Currency Group (DCG) and Gemini, now claiming they are responsible for $3 billion in investor losses tied to the defunct Gemini Earn program and direct investments with Genesis. The companies are accused of misleading investors and assuring them of the safety of their money, despite allegedly being aware of impending financial doom. The lawsuit has been expanded to include more investors who reported similar harm, prompting calls for stronger cryptocurrency regulations. DCG has responded by accusing the attorney general of seeking press attention and has vowed to fight the claims aggressively.