A detective from the US state of Wisconsin, Scott Simmons, helped a victim of cryptocurrency fraud who lost $551,000 identify the criminal and freeze the stolen funds.

According to the victim, the scammer contacted him on social networks. Having gained trust through friendly communication, the attacker convinced the user to invest money in a cryptocurrency project. The interlocutor showed screenshots of growing profits from other investors. The user initially transferred funds in small amounts, then transferred larger amounts of USDC stablecoins to the platform. There were 15 transactions in total. Having tried to withdraw his “profit”, the investor realized that he had been deceived.

During the investigation, federal detective Scott Simmons found out that the stolen money was laundered through several addresses, after which the stablecoins ended up at the address where USDC, USDT and ether were stored for $4.6 million. Using tools for analyzing suspicious transactions in the blockchain, federal agents were able to freeze crypto assets worth more than $800,000. They are promised to be returned to other victims.

“This case is a real victory for law enforcement. Most victims of crypto fraud say goodbye to their money forever simply because the police do not have the right tools to search for missing assets. Stolen funds are usually quickly transferred to crypto accounts abroad,” Simmons said.

Such schemes are known as “pig slaughter” – scammers make acquaintances on the Internet and then involve people in dubious crypto projects. When victims try to withdraw fictitious proceeds, they are required to pay a fee or some kind of tax. At the beginning of the year, federal agents from North Carolina managed to seize almost $5 million in USDT stablecoins from scammers – but such cases are quite rare, Simmons complained.

Last year, Tether, cryptocurrency exchange OKX and the US Department of Justice jointly blocked $225 million in USDT linked to a major human trafficking syndicate in Southeast Asia.