Tether, the issuer of the popular cryptocurrency USDT, has assisted US law enforcement agencies in investigating a large-scale fraudulent scheme that targeted mostly elderly citizens. The office of the district prosecutor of the Northern District of Illinois confirmed this information, acknowledging Tether’s efficiency in transferring assets related to the case, totaling $1.4 million.
Court documents reveal that an organized group of cybercriminals, specializing in technical support fraud, operated within the scope of this investigation. Their sophisticated scheme involved infecting victims’ computers with malicious software that generated false warnings of device compromise.
The scammers then posed as employees of well-known IT companies like Microsoft or Apple when contacting the victims, convincing them to transfer funds to purportedly secure government accounts to fend off hackers. To enhance credibility, the criminals presented fake documents, including ones bearing the forged signatures of prominent figures like US Federal Reserve Chairman Jerome Powell, as well as fabricated letters from financial institutions.
The victims were coerced into installing remote access applications, opening cryptocurrency wallets, and transferring their savings. In one documented case, a man transferred between $3 to $4 million, which included funds from his wife’s accounts.
A substantial portion of the stolen funds was converted into Tether’s USDT stablecoin, with the scammers attempting to launder and withdraw the funds. However, the FBI identified various cryptocurrencies linked to illicit activities in time and requested their blocking by Tether.
Tether confiscated the stolen assets from the perpetrators and minted an equivalent amount of new USDT, which was then transferred to a US government-controlled account for restitution to the rightful owners. The Federal Bureau of Investigations reported that in 2022, the cumulative losses from technical support fraud schemes surpassed $924 million.
This incident is not the first instance of Tether cooperating with law enforcement agencies. Previously, the company aided in the recovery of around 9 million USDT stolen in operations involving the Pig butchering scheme. Additionally, Tether blocked 225 million USDT associated with an international syndicate engaged in human trafficking in Southeast Asia.