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U.S. seizes crypto linked to Southeast Asian investment scam

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U.S. seizes crypto linked to Southeast Asian investment scam
Reuters
Tom Wilson and Poppy McPherson
December 12, 2023

By Tom Wilson and Poppy McPherson

(Reuters) - The United States has seized digital currency worth about half a million dollars from an account registered to a Chinese man who featured in a Reuters investigation into crypto-investment fraud run from Southeast Asia.

U.S. authorities said the scam that prompted the seizure involved a crypto-investment fraud known as pig butchering. In such schemes, fraudsters manipulate unsuspecting people they meet online, persuading them to invest in bogus crypto schemes.

The U.S. Secret Service seized the crypto from an account in the name of Wang Yicheng in June, according to a document filed by U.S. authorities in federal court in Massachusetts. The crypto was worth about $500,000 at the time. Money initially stolen from a Massachusetts victim was traced to Wang’s account, the Nov. 21 filing said.

Reuters, in an article published last month, identified Wang as a businessman who forged relationships with members of Thailand’s law-enforcement and political elite while serving as the vice president of a Bangkok-based Chinese trade group. The Nov. 23 article detailed how a crypto account in Wang’s name received more than $90 million in recent years, based on documents and transaction logs. Of that, at least $9.1 million came from a crypto wallet that U.S. blockchain analysis firm TRM Labs said was linked to pig-butchering scams, Reuters reported.

The report highlighted the example of a California man whose family said he was scammed out of about $2.7 million. He sent money to crypto wallets that channeled funds into the account in Wang’s name, the reporting showed. The recent U.S. court filing cited another example, a resident of Cambridge, Massachusetts. He was allegedly cheated of about $478,000 worth of crypto, which was diverted into two crypto accounts, one of which was in Wang’s name.

The details of the account given in the U.S. court filing – including who it was registered to, where it was held, the account number’s last four digits and the corresponding crypto wallet address – match the details of the Wang account highlighted in the Reuters report.

U.S. authorities said the account in Wang’s name had received more than $90 million since it was opened in 2020, according to the filing, which was an affidavit by U.S. Secret Service Special Agent Heidi Robles. “This level of activity is indicative of an account controlled by a criminal organization for the purpose of laundering stolen funds,” Robles said in the filing.

Wang did not respond to requests for comment. The head of the Thai police’s Cyber Crime Investigation Bureau declined to comment.

The trade group Wang represented is called the Thai-Asia Economic Exchange Trade Association. In response to questions for this article, it said it abided by laws and regulations and did not support illegal activity. It said Wang’s business and personal affairs had “nothing to do with the trade association,” adding that Wang was no longer part of the group and it was no longer in contact with him.

The Thai-Asia group previously told Reuters in a Dec. 4 letter that Wang left its board more than three months ago. That was due to Wang’s failure to pay the trade group’s new membership dues as well as “personal reasons,” on which the letter didn’t elaborate. The group said background checks it conducted on Wang when he originally applied for membership and after Reuters’ Nov. 23 report found no criminal record.

The U.S. court filing was part of a civil forfeiture action, in which the government seeks court approval to take possession of seized assets it alleges are linked to a crime. The United States has not filed a criminal action related to the case, the U.S. Attorney’s Office in Massachusetts said at the time of its November filing.

Acting U.S. Attorney Joshua Levy in Massachusetts told Reuters that his office has been using civil forfeitures to recover funds stolen via crypto fraud schemes. “Despite the seemingly elusive nature of cryptocurrency transactions, law enforcement is adapting and evolving,” he said in a statement.

(Reporting by Tom Wilson and Poppy McPherson; editing by Cassell Bryan-Low)

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