Crypto Scams on the Rise: California Victim Seeks $3M in Damages from Asian Banks

The Alarming Rise of Crypto Scams: A $28M Loss in 2024

The world of cryptocurrency has been hit with a wave of scams, resulting in a staggering $28 million in losses in 2024 alone. This represents a 72% increase from the previous year, leaving many investors reeling. One such victim, Ken Liem from California, has taken a bold step by filing a complaint against three major Asian banks, accusing them of negligence in preventing a devastating crypto scam.

A Devastating Scam: How Liem Lost Nearly $1 Million

Liem’s ordeal began on LinkedIn in June 2023, where scammers posed as representatives of a lucrative cryptocurrency investment. Over several months, they convinced Liem to transfer substantial sums into accounts at Fubon Bank Limited and Chong Hing Bank Limited in Hong Kong, and DBS Bank Limited in Singapore. The scammers then laundered the money through third-party accounts, leaving Liem with little hope of recovery.

Banks Accused of Negligence: Failure to Follow KYC and AML Protocols

Liem’s complaint, filed in the California district court on December 31, 2024, alleges that the banks failed to follow basic Know Your Customer (KYC) and Anti-Money Laundering (AML) protocols. This failure, he claims, allowed the scammers to launder his money with ease. The banks are also accused of violating the U.S. Bank Secrecy Act by failing to detect red flags that could have prevented the scheme.

Other Companies Implicated in the Scam

Four Hong Kong-related companies – Richou Trade Limited, FFQI Trade Limited, Xibing Limited, and Weidel Limited – are also implicated in the scam. They allegedly collaborated with the scammers by opening accounts to drain Liem’s money under false pretenses of cryptocurrency investments.

A Call for Accountability: Liem Demands $3M in Damages

Liem is seeking at least $3 million in damages and a jury trial. His attorneys argue that simple due diligence would have revealed suspicious activity related to the fraudulent accounts. This case highlights the critical role financial institutions play in preventing fraud and the need for robust security measures to protect investors.

The Bigger Picture: Crypto Losses and the Rise of Pig Butchering Scams

While crypto losses have decreased by 17% to $1.49 billion in 2024, the number of victims has surged, with a 72% increase in scams. This trend is alarming, and financial organizations are facing the consequences of their negligence. As the world of cryptocurrency continues to evolve, it’s essential for investors to be aware of the risks and for financial institutions to prioritize security and accountability.

What’s Next?

As the case unfolds, it will be interesting to see how the banks respond to Liem’s allegations. One thing is certain – the rise of crypto scams is a wake-up call for investors and financial institutions alike. Will we see a shift towards more robust security measures and greater accountability in the world of cryptocurrency? Only time will tell.

Source: Livebitcoinnews.com

The post California Man Sues Banks for $3M Over Crypto Scam Losses appeared first on CoinBuzzFeed.