DOJ Investigates Romance Scammers as Tether Freezes $225 Million USDT

DOJ Investigates Romance Scammers as Tether Freezes $225 Million USDT


Tether Freezes $225M in USDT as Part of DOJ Investigation

Stablecoin issuer Tether has frozen approximately $225 million worth of USDT as part of a United States Department of Justice investigation into a Southeast Asian human trafficking syndicate. Tether announced on Nov. 20 that it had worked with the DOJ and crypto exchange OKX to freeze $225 million worth of USDT in “external self-custodied wallets.” The firm reported that the illicit funds were used by a crime syndicate responsible for a “pig butchering” romance scam.

According to Tether, the USDT freezing followed a “months-long investigative effort” into the location of the funds. The stablecoin issuer said it would work with U.S. authorities to unfreeze any “lawful” wallets that may have been seized as part of the effort.

Tether has previously worked with global law enforcement agencies to freeze assets allegedly linked to criminal syndicates. Unlike cryptocurrencies such as Bitcoin, stablecoins like USDT are more likely to be issued by a single authority, allowing issuers to freeze funds and halt transactions in response to law enforcement requests.

Response to Law Enforcement

Crypto moving through exchanges is sometimes subject to the same treatment. Binance, for example, restricted account access to $1 million in crypto for a Tezos tool contributor following a request from authorities. Similarly, Binance froze accounts linked to Hamas militants in October 2023 in response to Israeli law enforcement.

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It is essential to recognize the control that issuers of stablecoins like Tether have over their funds and transactions. Working closely with law enforcement agencies, as Tether does, can help maintain the integrity and security of the crypto industry and prevent criminal activities.

DOJ Investigates Romance Scammers as Tether Freezes $225 Million USDT
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