FBI Seizes $4.99 Million in Cryptocurrency from Romance Scam
Federal prosecutors in North Carolina are pursuing the forfeiture of over $4.99 million in cryptocurrency recovered from a sophisticated crypto romance scam that defrauded numerous victims.
A report by Triangle Business Journal details how the scheme operated through fake trading platforms and emotional manipulation, particularly targeting older individuals.
How the Scam Unfolded
The fraud began with seemingly harmless text messages and social media connections. Scammers posed as love interests, building trust with victims using false identities and elaborate backstories.
The Federal Bureau of Investigation (FBI) identified 71 victims, including a 60-year-old man from Angier, North Carolina, and an 83-year-old Minnesota resident, who collectively lost nearly $2.75 million. Victims were directed to Bitkanant, a fraudulent crypto trading platform designed to mimic the legitimate Singapore-based Bitkan exchange, convincing them to invest their life savings in a secure opportunity.
One victim, a retired Angier resident, was contacted by someone claiming to be “Jeanie,” who fabricated a story about her uncle developing an algorithm for predicting Bitcoin prices. She persuaded him to invest his entire retirement savings — $1.8 million — into the fake platform. When he attempted to withdraw his funds, he was told withdrawals were blocked until additional taxes and fees were paid. The fraudulent website subsequently disappeared, and the victim discovered his credentials were being used on similar clone sites.
Another victim, an 83-year-old man from Minnesota, was similarly deceived by an individual claiming to be “Alice,” using the same backstory. He invested all his savings, including funds from a surrendered life insurance policy, totaling $950,000.
The FBI Investigation
The FBI traced the stolen funds to nine unhosted Tether wallets seized in August through a search warrant. These wallets contained $4.99 million in cryptocurrency, now held by the US Marshal Service. Federal authorities argue these funds represent proceeds from criminal activity and are seeking their forfeiture.
Court documents reveal that scammers rapidly moved the stolen funds across multiple wallets to obscure their trail, a common tactic in crypto fraud. Despite recovering the funds, no arrests have been made, and the FBI continues its investigation, suspecting it is part of a larger organized operation.
Federal agencies have issued warnings about the risks of crypto scams, urging the public to exercise caution when approached online with investment opportunities. Experts recommend avoiding unsolicited offers and verifying the authenticity of any platform before transferring funds.
A Broader Trend
This case reflects a broader trend of crypto scams targeting older adults. According to the FBI, romance scams, also known as “pig butchering scams,” have become increasingly prevalent, exploiting personal relationships to extract money. In 2023 alone, losses from crypto scams exceeded $5.6 billion, with seniors being the most affected demographic. Fraudsters often combine emotional manipulation with promises of lucrative investments, leaving victims financially devastated.