U.S. Treasury Sanctions 19 Entities Over Crypto Scams

The U.S Department of the Treasury has sanctioned 19 Southeast Asian entities across Myanmar and Cambodia for operating crypto investment scams that defrauded Americans of billions of dollars. The sanctioned operations forced human trafficking victims to carry out crypto investment scams. 

As per an official press release dated September 8, the syndicates used violence and forced labor to coerce trafficking victims into targeting American individuals. The entities comprise nine in Myanmar and 10 in Cambodia. The Myanmar entities were reported to be operating under protection of OFAC-designated Karen National Army (KNA). The release also noted that Americans lost at least $10 billion in 2024 to Southeast Asia-based scam operations, a 66% increase compared to the previous year.

John K. Hurley, Under Secretary of the Treasury for Terrorism and Financial Intelligence, stated, “Southeast Asia’s cyber scam industry not only threatens the well-being and financial security of Americans, but also subjects thousands of people to modern slavery. In 2024, unsuspecting Americans lost over $10 billion due to Southeast Asia-based scams and under President Trump and Secretary Bessent’s leadership, Treasury will deploy the full weight of its tools to combat organized financial crime and protect Americans from the extensive damage these scams can cause.”

Detailed Schemes Target American Investors

The sanctioned scammers were found to employ various methods to recruit and force individuals to work for them. This includes hiring people under false pretenses and resorting to debt bondage, violence and sexual exploitation to force them to reach out to scam victims. 

One of the primary techniques that such operations use is “pig butchering.” It involves scammers contacting victims online to build a relationship with them. The scammers then convince the victims to make crypto investments into websites or apps they control. They even show them fabricated evidence to gain trust. The victim being convinced then makes the investment; but when they attempt to cash out, they are met with excuses or the scammers just disappear. 

Further, the department also found that scam operators specifically recruit individuals with good English language skills to target American victims. Former scammers even reported daily quotas for the number of targets.

The rising number of Southeast Asian crypto scams has prompted calls for enhanced industry collaboration with law enforcement. The new sanctions build on the U.S. government’s broader enforcement strategy for combatting crypto-related crime.

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