The United States Attorney’s Office for the Northern District of Ohio has filed a civil complaint in forfeiture against Tether cryptocurrency, valued at more than $8.2 million.
USDT is a virtual currency, which are digital tokens of value circulated over the internet. Its transactions are publicly recorded on what is known as a blockchain.
According to court documents, the FBI has identified 33 victims across the country of an investment fraud scheme, including a victim from Mentor. In total, victims lost approximately $4.9 million. Five more accounts have also been found to be affected, and the FBI is attempting to identify the respective owners.
Investigators found that scammers initially contacted the victims through seemingly misdirected, or “wrong number,” text messages. The fraudster then gained the victim’s trust and affection using various manipulative tactics, the release stated. Once trust was established, the fraudster would share how much success they, or someone they knew, had with investing in cryptocurrency.
“This personal testimonial lessened any uncertainties the victims may have had about virtual currencies and eventually had the intended effect to persuade the victim to proceed with the investment,” the Attorney’s Office stated in the release.
The fraudster would then guide the victim on how to open a legitimate cryptocurrency account, most often with a U.S. based virtual currency exchange such as Crypto.com or Coinbase. However, once the victim transferred their funds to the “investment platform” they unknowingly handed over complete control and ownership of their funds to the scammer.
A woman in Lake County became the target of such a scam when she responded to a text on her phone from an unknown number in November 2023. She began sharing information via text with the person and the two bonded over topics such as hobbies and religion.
Over a period of time, the victim followed instructions from her new “friend” and opened an account at Crypto.com and then transferred funds into the account. When the victim wanted to withdraw funds, her “friend,” relented and said additional payments were needed and she complied.
When the victim no longer had any funds left after making additional payments, her “friend” began to threaten her that he would send his friends to “take care of” her friends and family, the release stated. Having lost her entire life savings of approximately $663,352, including funds from her Roth IRA, the victim filed a complaint with the FBI’s Internet Crime Complaint Center to report the losses in June 2024.
The FBI Cleveland Division subsequently initiated an investigation.
If the forfeiture action is successful, the United States would seek to return the stolen funds to the victims, according to the release.
