The U.S. government is taking legal action to seize 200,000 tethers (USDT), worth $200,000, linked to a major cryptocurrency scam. The funds, converted from stolen bitcoin, could soon be returned to Ohio victims following a forfeiture hearing. Investigators used blockchain technology to track the ill-gotten funds, leading to a freeze and eventual federal forfeiture. The case highlights the growing use of cryptocurrencies in financial crimes.

US seeks to seize $200,000 in Tether after Ohio crypto fraud

The U.S. Attorney’s Office for the Northern District of Ohio announced on Friday that the United States has filed a civil forfeiture complaint to seize 200,000 Tether (USDT), a cryptocurrency worth $200,000. The action stems from a February 2024 incident in which $340,000 worth of bitcoin was fraudulently transferred from a victim’s wallet in Ohio. The U.S. Attorney’s Office detailed:

In February 2024, approximately $340,000 worth of bitcoin was fraudulently transferred from a virtual wallet belonging to a victim in Ashtabula, Ohio, to a cryptocurrency address unknown to the victim. The victim did not initiate or authorize the transaction.

The investigation found that the stolen bitcoins were converted into USDT by the perpetrators. “As part of this analysis, we determined that the fraudulently transferred bitcoins were converted into USDT cryptocurrency by the fraudsters,” US authorities noted.

The tracking process used blockchain technology to trace about $200,000 of the stolen funds to two Ethereum-based addresses. Tether Limited Inc. froze the USDT tokens, worth $200,000, until March 2024. In July, a federal forfeiture order allowed the tokens to be transferred to a virtual wallet controlled by law enforcement.

On October 3, 2024, the United States filed a Forfeiture Complaint to seize 200,000 USDT, which will be returned to the Ohio victims if the forfeiture is successful. The United States Attorney's Office explains:

According to the Complaint for Forfeiture filed on October 3, 2024, the United States seeks to seize 200,000 USDT in cryptocurrency. If successful, the United States will seek to return the seized funds to the Ashtabula, Ohio victim.

What do you think about this cryptocurrency scam and the government’s efforts to recover the stolen funds? Let us know in the comments below.
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