The U.S. Department of Justice is moving to forfeit more than $25 million in cryptocurrency tied to five fraud investigations involving fake investment schemes, romance scams, and a fee-based recovery scam.
- $25M+ in crypto targeted for forfeiture
- Five investigations across the U.S. and Canada
- Investment, romance, and recovery scams at the center
- Laundering networks traced through overseas wallets
- Victims may recover funds if claims are resolved
This is the part of crypto crime most people never see: not the scammer’s Telegram pitch or fake profit dashboard, but the machinery that moves the money after the victim sends it. The DOJ says it is going after the laundering layer first, because that is where stolen funds are hidden, split apart, and pushed through wallet clusters and exchange accounts before anyone can blink.
According to the Justice Department, the forfeiture action covers five separate investigations. Victims were located in the United States and Canada, while investigators traced the laundering networks to fraud operations allegedly based largely in Southeast Asia. The DOJ also said IP activity linked to the schemes was primarily associated with China, Malaysia, and Cambodia. That is an allegation, not a passport stamp, IP data can point to network activity, not always the real person behind it.
The largest investigation began after Canadian authorities alerted U.S. investigators in late 2024. That case involved more than 270 suspected victim transactions and seeks roughly $10.4 million in cryptocurrency. A second investigation, involving online romance scams, affected more than 200 victims and seeks approximately $12.1 million.
Three other investigations came from victims in the U.S. National Capital Region. One seeks about $1.2 million, another roughly $2.4 million, and the fifth, a fee-based recovery scam, seeks nearly $285, 000.
That last category is especially rotten. A recovery scam targets people who have already been robbed and then offers to “help” them get their money back for an upfront fee. It is fraud wearing a fake rescue vest. The same crooks, or their cousins, often come back to the victim a second time because apparently one theft is never enough for some people.
The U.S. Secret Service’s Washington Field Office, working through the Scam Center Strike Force, traced the laundering networks tied to thousands of suspected victims worldwide, according to investigators. Jeanine Ferris Pirro, the U.S. Attorney who launched the Scam Center Strike Force in November 2025, said the latest seizure showed the value of pursuing “international laundering operations instead of focusing only on the fraud itself.”
“international laundering operations instead of focusing only on the fraud itself”
She also said investigators “dismantled complex laundering networks, protected victims, and interrupted criminal financial channels used to move illicit proceeds.”
“dismantled complex laundering networks, protected victims, and interrupted criminal financial channels used to move illicit proceeds”
That approach is the right one. These scams are rarely the work of one lonely con artist sending awkward DMs from a basement. They are cross-border operations with recruiters, wallet handlers, cash-out crews, and people whose entire job is to make stolen funds harder to trace. The scam is the bait. The laundering is the machine.
The DOJ says the latest recovery brings assets seized through the Scam Center Strike Force to more than $800 million. That is a reported enforcement total, not a promise that every dollar will reach victims, but it does show the scale of the federal response. Crypto fraud has become a volume business, and U.S. agencies are increasingly treating it that way.
For readers less familiar with the legal side, civil forfeiture is a process that lets the government seize property believed to be tied to crime. It is not the same as a criminal conviction. The government has to show the assets are connected to wrongdoing, and anyone claiming ownership can challenge the seizure in court. If claims are resolved in the government’s favor, recovered assets can sometimes be returned to eligible victims.
That matters because forfeiture is not magic. Wallets can be frozen, transactions can be traced, and seizures can be filed, but actual recovery still depends on courts, evidence, and ownership claims. Some funds will be easier to pin down than others. Once money moves through enough wallets, exchanges, and jurisdictions, the paper trail gets messy fast.
The DOJ’s emphasis on laundering also fits a broader enforcement pattern. In March 2026, the U.S. Attorney's Office Files Civil Forfeiture Action to seeking 327, 829.72 USDT tied to an online romance scam. The alleged victim was approached on a dating app in November 2024 by someone using the name “Linda Brown, ” then manipulated into sending money to wallets controlled by the fraud network. Prosecutors said the funds were moved through multiple intermediary wallets and converted into USDT, Tether’s dollar-pegged stablecoin.
Stablecoins like USDT are useful because they settle quickly and are easy to move. That makes them handy for legitimate payments and trading, and also handy for criminals who want to shift value across wallets without waiting around like they forgot what year it is. The problem is not the existence of the tool. The problem is the people abusing it.
Blockchain analysis helps because public ledgers leave a trail. That trail can be followed across wallet transfers, repeated hops, and exchange deposits. But tracing is not the same as attribution. Criminals use multiple wallets, mixers, cross-chain movement, shell accounts, and mule networks to break the link between the scam and the person controlling the funds. Finding the money is one job. Proving who owns it is the harder one.
This is also why crypto enforcement keeps colliding with ransomware, sanctions, and cartel finance. In July 2025, the Justice Department filed a civil forfeiture complaint seeking nearly $2.3 million worth of Bitcoin allegedly linked to the Chaos ransomware group. In May 2026, the U.S. Department of the Treasury sanctioned two networks tied to Mexico’s Sinaloa Cartel and identified multiple Ethereum wallet addresses connected to those sanctions. Sanctions do not just slap a label on bad actors, they block U.S. persons and institutions from dealing with them, turning wallets into toxic waste for compliant financial rails.
There is a useful counterpoint here, too. Crypto transparency does help investigators in ways cash never could, because a public ledger can preserve a transaction history. But anyone claiming blockchain analytics alone will clean up global fraud is selling fantasy with a straight face. Criminals adapt. They use off-chain cash-outs, shell companies, money mules, and offshore intermediaries. The chain is visible; the humans are slippery.
Still, the fact that investigators can trace and seize millions in digital assets is not nothing. It means stolen crypto does not simply vanish into a digital void. It leaves evidence. When law enforcement follows that evidence beyond the initial scam and into the laundering network, victims have a better shot at seeing some of their money again.
Key takeaways
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Why is the DOJ going after the crypto instead of only the scammers?
Because forfeiture targets the assets tied to the crime. If investigators can freeze the wallets and trace the laundering routes, they can disrupt the fraud network and sometimes recover funds for victims. -
What kinds of scams are involved?
Fake crypto investment schemes, romance scams, and a fee-based recovery scam. That last one is particularly ugly because it targets people who have already lost money. -
Can victims get their money back?
Possibly, but not automatically. Civil forfeiture can allow eligible victims to assert claims, and recovered assets may be returned after ownership disputes are resolved. -
Why do scammers use USDT and other stablecoins?
Stablecoins move quickly, are highly liquid, and are widely accepted. That makes them useful for legitimate transfers and very useful for laundering stolen funds. -
Is blockchain tracing enough to stop this kind of crime?
No. It helps a lot, but attribution is still difficult because criminals use layered wallets, exchanges, mixers, and cross-border networks.
The bigger message is simple: crypto crime is no longer just about the bait. The real fight is against the laundering infrastructure that sits behind it. The DOJ is finally treating that infrastructure as the main target, and that is exactly where the pressure belongs.
Further reading
A few related enforcement and policy resources worth keeping on hand:
- U.S. DOJ targets $25M in crypto linked to investment and romance scams
- Overview of Divisions and Topics in the U.S. Attorney's Office for the District of Columbia
- OFAC sanctions Sinaloa Cartel network, including six Ethereum addresses
- Asset Forfeiture Policy Manual 2025
- Feds seize $3.4M in stolen Tether as crypto fraud crackdown intensifies
- US DOJ cracks down on crypto fraud: 10 charged in $23M wash trading scheme
- Hong Kong’s largest crypto fraud: 10 more charged in JPEX money laundering scandal
