CHICAGO — Through a court-authorized seizure warrant, the U.S. Attorney’s Office in Chicago has seized approximately $1.4 million of Tether (USDT), a cryptocurrency pegged to the U.S. dollar. The funds, which are suspected fraud proceeds, will be returned to victims of the fraud scheme. The seizure marks one of the first times the United States has recovered USDT from an unhosted virtual currency wallet.
The seizure was announced by Morris Pasqual, Acting United States Attorney for the Northern District of Illinois, and Robert W. “Wes” Wheeler, Jr., Special Agent-in-Charge of the Chicago Field Office ofthe FBI. Valuable assistance was provided by the Justice Department’s Computer Crime and Intellectual Property Section, National Cryptocurrency Enforcement Team. The government is represented by Assistant U.S. Attorney Steven J. Dollear. The U.S. Attorney’s Office acknowledged Tether for its assistance in effectuating the transfer of these assets.
The alleged fraud scheme, which remains under investigation, was initiated by a computer popup that indicated a victim’s computer had been compromised. The popup directed the victim to contact Microsoft or Apple, depending on the victim’s operating system, at a certain telephone number. Once on the phone, the perpetrators, posing as tech support employees, informed the victim that the victim’s bank account had also been compromised. The perpetrator then transferred the call to others posing as employees of the fraud department of the victim’s bank. The perpetrators convinced the victims to convert money from traditional bank accounts into cryptocurrency to keep it “safe” from hackers. The funds were then transferred into unhosted virtual currency wallets controlled by the perpetrators. The scheme has impacted victims, mostly elderly, throughout the United States.
In its most recent Internet Crime Report, the FBI estimated that tech support scams caused losses in excess of $924 million in 2023.
