Tether and OKX Halt $200 Million Linked to Romance Scam

By Philip Maina

1 hour agoTue Nov 21 2023 11:36:54

Reading Time: 2 minutes

Tether has frozen over $200 million in USDT linked to the pig butchering scam targeting persons in Southeast Asia
Tether worked with crypto exchange OKX and the United States Department of Justice
The freezing comes at a time when the U.S. DOJ is investigating the human trafficking syndicate

Stablecoin firm Tether has frozen over $200 million in USDT linked to the Southeast Asian human trafficking syndicate. The freezing was made possible through the cooperation of the stablecoin issuer, OKX crypto exchange and the United States Department of Justice (DOJ), which has been investigating the scam. Tether disclosed that it unfroze some funds that were mistakenly thought to be part of the syndicate, an indication that law enforcement agencies are getting better at tracking crypto payments.

$225 Million Held in 37 Wallets

In a statement, Tether said that the investigations were conducted with the help of blockchain analysis firm Chainalysis. On-chain details show that the frozen amount was $225 million spread across 37 wallets with one of the wallets holding $87.5 million.

Tether froze ~225M $USDT (37 wallets) linked to a human trafficking group 1 hour ago.

These wallets had been moving $USDT before being frozen, with most of the $USDT being transferred to #OKX.

Check frozen TX here.https://t.co/TlfFJvpgiW pic.twitter.com/vEMTd3YzBq

— Lookonchain (@lookonchain) November 20, 2023

Tether said that the frozen funds are held by wallets “on the secondary market and are not associated with [its] customers.” The stablecoin issuer also said that there’s an option for wallet users affected in the efforts to lodge a complaint in case their wallets were unlawfully included in the list.

According to Tether CEO Paolo Ardoino, the move reflects his company’s “commitment to transparency […], integrity [and] safety within the crypto space.” OKX CIO Jason Lau commented on the developments saying that it shows the exchange’s “approach to building trust and serving the public good.”

Romance Scams a Global Concern

Tether’s move comes eight months after the DOJ seized $112 million in crypto linked to pig butchering scams. Law enforcement agencies globally have in the past highlighted romance scams as a global concern having been busted in different countries such as the Philippines.

This isn’t the first time Tether has frozen funds. A month ago, for example, it froze over $800 million linked to criminal activities in Brazil, Singapore, the United States and Germany.

With Tether and crypto exchanges showing a willingness to freeze illicit funds, malicious actors will likely look for different avenues to move funds to avoid detection by law enforcement agencies.

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