Federal prosecutors in Seattle filed a civil action to seize $7.1 million in cryptocurrency.
The crypto was tied to an oil and gas investment scam that ran between June 2022 and July 2024. The U.S.
Attorney’s Office for the Western District of Washington made the announcement on July 23.
Homeland Security had already seized the funds in December. Authorities alleged that fraudsters collected $97 million from victims and used part of the stolen money to buy crypto. The funds were then moved through several cryptocurrency accounts, according to Acting U.S. Attorney Teal Luthy Miller.
“The co-schemers in this fraud moved their ill-gotten gain through various cryptocurrency accounts to try to launder the money stolen from victims,”
Miller said.
Crypto Laundering Operations Tied to Russia and Nigeria
The U.S. Attorney’s Office said that the targeted crypto accounts belonged to people living in Russia and Nigeria.
These individuals allegedly used stolen money to purchase Bitcoin (BTC), Tether (USDT), USD Coin (USDC), and Ether (ETH). Prosecutors said some of the funds were transferred to crypto exchanges based in their home countries.
Geoffrey Auyeung was indicted in August 2024. Prosecutors accused him of receiving a large portion of the stolen money. He allegedly converted it to cryptocurrency and sent the majority of it to Binance, a global crypto exchange.
Authorities also seized nearly $2.3 million from Auyeung’s U.S. bank accounts. Prosecutors claim he facilitated crypto laundering for transnational criminal groups.
Victims Lost $17.9M to Oil and Gas Investment Scam
Investigators identified victims who lost a total of $17.9 million in the oil and gas investment scam. They expect more victims to be confirmed once proper checks are complete.
The original scheme promised returns from renting oil tank storage facilities. Victims believed their investments would generate profits. However, once they sent money, communication stopped. No profits were delivered.
The U.S. Justice Department aims to return recovered money to verified victims. If the court approves the $7.1 million forfeiture request, total recovered funds will reach $9.4 million.
US Crackdown on Crypto Scams Intensifies
The oil and gas investment scam is part of a wider trend of enforcement actions. Earlier this month, U.S. prosecutors charged two men behind OmegaPro with defrauding investors of $650 million. They could face up to 40 years in prison.
On July 19, former rugby player Shane Donovan Moore received a 2.5-year sentence in U.S. federal prison. He ran a Ponzi scheme involving $900,000 and more than 40 victims.
On July 18, Hong Kong police arrested four people connected to a separate crypto scam worth 3 million Hong Kong dollars (about $382,000). The suspected leader reportedly left the country before the arrests.
U.S. authorities continue targeting crypto fraud through legal actions, asset seizures, and international cooperation.
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