Crypto Investment Scams Linked to $12.7 Billion in Suspicious Activity

Swan.my.id - Jakarta - U.S. authorities have linked approximately $12.7 billion in suspicious financial activity to crypto investment scams operating largely from overseas scam compounds.

The Financial Crimes Enforcement Network, or FinCEN, reached the figure after reviewing 33,904 Bank Secrecy Act reports filed by roughly 1,300 financial institutions. The reports covered activity from Sept. 8, 2023, through Dec. 31, 2025.

The suspected schemes affected victims across all 50 U.S. states and several territories. Criminal groups commonly used fake identities and relationships to gain trust before directing victims toward fraudulent digital asset investments.

Crypto Investment Scams Generated Billions in Reports

Money services businesses submitted 55% of the reports reviewed by FinCEN and identified $5.5 billion in suspicious activity. Most of those businesses were digital asset companies.

Banks accounted for 41% of the filings and reported another $6.4 billion. Securities firms and other financial institutions made up the remaining share, flagging $784.5 million in suspicious activity.

Reporting increased throughout the period covered by the analysis. The monthly number of filings rose by an average of 10.9%, while the reported amount of suspicious activity increased by an average of 18%.

In October 2023, financial institutions submitted 590 reports involving $485.7 million. By December 2025, the monthly total had reached 2,482 reports covering $833.5 million.

However, FinCEN cautioned that the $12.7 billion figure should not be treated as a direct measure of victim losses. Suspicious activity reports can include attempted transactions, transfers reported by more than one institution and filing errors. These factors can result in double counting.

The agency also said the increase in filings may partly reflect greater use of a search term introduced in its 2023 alert on pig butchering scams.

Stablecoins Became a Key Route for Scam Proceeds

The scam operators did not rely on tokens created specifically for the fraud. At least 22 digital assets appeared in the reports, including Ethereum, Tether’s USDT and Circle’s USDC.

Regardless of the asset victims initially purchased, blockchain analysis cited by FinCEN found that the proceeds were usually converted into stablecoins. The funds were converted almost exclusively into USDT before moving through decentralized finance protocols or digital asset exchanges outside the United States.

Repeated use of the same collection addresses gave financial institutions another way to trace the networks. Some institutions identified addresses receiving transfers from several victims at the same time. That pattern helped connect transactions that initially appeared unrelated.

The use of stablecoins has also appeared in enforcement actions involving similar fraud. In 2025, the U.S. Secret Service worked with Coinbase to trace and recover USDT linked to pig butchering schemes. The Department of Justice separately sought the seizure of $225 million in USDT after investigators connected the funds to Southeast Asian fraud networks.

Victims Used Retirement Funds and Loans

Older Americans appeared in about one-quarter of the suspicious activity reports. FinCEN compared that figure with the 24.4% share of the U.S. population aged 60 or older and concluded that older adults were neither disproportionately victimized nor disproportionately deprived of funds within the dataset.

Even so, individual losses could be severe. FinCEN identified cases involving retirement accounts, home equity lines of credit, second mortgages and personal loans.

One woman transferred nearly $640,000 from her retirement fund. Another victim lost more than $1 million over six months.

The FBI recorded $4.8 billion in fraud losses among Americans over 60 in 2024. Senators later cited that figure when introducing the GUARD Act, which would provide resources for blockchain tracing by local law enforcement.

FinCEN also warned about the psychological impact of these schemes. Some victims may face a risk of self-harm after discovering that their money has been stolen. The agency directed people in crisis to the 988 Suicide and Crisis Lifeline.

Scam Compounds Operated Across Southeast Asia

Many criminal organizations identified by authorities operated from large compounds in Cambodia, Laos and Burma. Workers could be recruited through fake employment offers, then confined and forced to participate in fraudulent activity.

The United Nations has estimated that hundreds of thousands of people have been trafficked into such operations. Interpol has also warned that the scam-center model has expanded beyond Southeast Asia.

A February 2026 Chainalysis study found that crypto-linked trafficking payments increased 85% during 2025 across tracked services. The study included labor recruiters associated with Southeast Asian scam compounds and identified stablecoins, laundering networks and regional escrow platforms as payment channels.

Authorities have pursued the financial infrastructure supporting the compounds. In March, the FBI and Thai police froze roughly $580 million in cryptocurrency and seized around 8,000 phones during an operation against organized pig butchering groups accused of targeting Americans.

FinCEN said the networks can involve more than the people who communicate directly with victims. Scam-center operators use online “guarantee marketplaces” to obtain phishing tools, online accounts and money-laundering services.

Professional money launderers can create shell companies and financial accounts, recruit money mules and route stablecoins through exchanges outside the United States.

Authorities Expand Efforts to Recover Funds

Cambodia-based Huione became one prominent example of this financial infrastructure. Chinese authorities took custody of a former Huione Group chairman in April after the network was linked to more than $89 billion in crypto transactions.

U.S. authorities had previously designated Huione Group a primary money laundering concern over its alleged role in processing proceeds connected to Southeast Asian scams and other illicit activity.

FinCEN said its Rapid Response Program has interdicted $1.8 billion since 2015 and recovered just over $1 billion for 5,790 U.S. victims. The program allows the agency to share financial intelligence quickly with foreign financial intelligence units and seek intervention before suspected fraudulent transfers move beyond recovery.

FinCEN’s latest alert provides financial institutions with indicators for identifying transactions connected to scam centers. It also encourages voluntary information sharing under Section 314(b) of the USA PATRIOT Act.

The agency said this information sharing can help institutions identify money laundering activity while providing qualifying participants with liability protections.

U.S. prosecutors have continued pursuing networks accused of combining investment fraud with forced labor. One case involved the Cambodia-based Prince Group, while authorities sought forfeiture of more than 127,000 Bitcoin linked to its founder, Chen Zhi.

Prosecutors alleged that workers confined in scam compounds were forced to contact potential victims and direct them toward fraudulent cryptocurrency investments. U.S. and U.K. authorities have accused Chen Zhi and Prince Group of involvement in cryptocurrency fraud, money laundering and forced-labor operations. The company has denied the allegations.

FinCEN urged victims of cyber-enabled fraud to contact their financial institutions immediately. Victims can also file complaints with the FBI’s Internet Crime Complaint Center or their nearest U.S. Secret Service field office.