DOJ, FBI, Secret Service Unveil 'Strike Force' to Combat Crypto Scams Rooted in China
The U.S. Department of Justice (DOJ) announced the creation of the Scam Center Strike Force, an interagency initiative to dismantle international crypto scams, specifically targeting 'pig butchering' schemes linked to Chinese organized crime. These scams, which leverage fake crypto sites and false social media identities, have defrauded Americans of approximately $135 billion in 2024 alone. The initiative aims to identify scam leaders, recover stolen funds, and disable scam infrastructure. The DOJ, in coordination with other agencies such as the FBI, Treasury Department, and Secret Service, is taking a unified approach against global crypto crimes. The initiative is part of a broader strategy tied to fostering trust in cryptocurrency under President Donald Trump's pro-crypto agenda. The announcement also included sanctions against a militant group involved in scams and human trafficking in Burma. Experts praised the coordinated federal effort as a proactive and unified shift in tackling crypto-related fraud.
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Introduction to the Scam Center Strike Force
The U.S. Department of Justice's D.C. office announced an interagency initiative on Wednesday aimed at dismantling international crypto scam operations known as 'pig butchering' schemes. The newly formed Scam Center Strike Force will involve collaboration among the DOJ, FBI, Secret Service, U.S. Treasury, and other government agencies to combat transnational criminal networks. These networks have stolen billions of dollars from victims over the years through fake crypto sites and false identities on social media platforms.
Jeanine Pirro's Announcement and The Scale of the Threat
Jeanine Pirro, the U.S. Attorney for the District of Columbia, announced the initiative during her remarks on Wednesday. She highlighted the connection between online crypto scams and Chinese organized crime networks, describing it as a 'growing epidemic.'
"Crypto investment fraud scams perpetrated by organized Chinese crime syndicates that successfully target Americans and victimize them," Pirro said.
Pirro claimed that $135 billion was likely defrauded from Americans in 2024 alone. Her office has already seized $400 million in crypto from bad actors, with an additional $80 million seized as part of recent efforts, which the DOJ will aim to return to victims.
Mission and Goals of the Strike Force
Pirro outlined the mission of the Scam Center Strike Force, stating:
- Identifying and charging leaders of cryptocurrency scam organizations
- Tracing and seizing stolen funds to compensate victims
- Disabling United States infrastructure that facilitates these scams
She tied the initiative to President Donald Trump's pro-crypto agenda, emphasizing the importance of a safe and trusted environment for Americans to adopt cryptocurrency. According to Pirro:
"There are no tricks that can be a part of cryptocurrency."
Treasury Sanctions and New Measures Against Crypto Crimes
During the press conference, the U.S. Treasury Department announced sanctions against a Burmese militant group operating a cyber scam compound. The group purportedly used human trafficking victims as forced labor in their scam centers. Additionally, two companies and a Thai national linked to the militant group and Chinese organized crime were sanctioned. These measures demonstrate a more aggressive stance by U.S. authorities against cyber-enabled fraud and its broader criminal networks.
Criticisms of Past Efforts and TRM's Response
Leading crypto security experts have long argued that the U.S. government failed to tackle 'pig butchering' scams effectively, often addressing issues piecemeal rather than with a unified approach. These scams operate by building trust with victims over time, 'fattening them up' before stealing their money.
Experts at blockchain intelligence firm TRM believe that a coordinated interagency approach is needed. Reacting to the announcement, TRM Head of Global Policy Ari Redbord stated:
"The Scam Center Strike Force is the clearest statement yet that the United States intends to fight back with the full power of the state."
A Recent Model for Success
Last month, the DOJ seized $14 billion worth of Bitcoin from a Cambodian-based crypto scam network tied to China. This operation, the largest forfeiture action in DOJ history, demonstrated coordinated efforts among the DOJ, FBI, DEA, and State Department. The operation combined criminal charges, financial sanctions, diplomatic measures, and on-chain investigations.
TRM's Redbord praised this collaborative model, emphasizing its potential for the future:
"When law enforcement, regulators, and intelligence agencies operate as one, the model for dismantling global cyber-enabled fraud becomes not just reactive, but proactively disruptive."