A US crypto scam involving Tether shows how romance fraud is growing globally and posing more tests for payments firms and regulators.
Federal agents in North Carolina have seized more than $61m in cryptocurrency tied to an alleged “pig butchering” investment scam.
The US Attorney’s Office for the Eastern District of North Carolina confirmed the seizure of Tether (USDT) on 24 February, after investigators traced the funds to wallets allegedly used to launder proceeds from fraudulent crypto investment schemes.
Authorities said the assets were identified through a joint investigation with Homeland Security Investigations (HSI), which followed a victim complaint submitted via the agency’s tip line.
“The seizure of a staggering $61 million dollars’ worth of funds linked to cryptocurrency fraud shows that, in the Eastern District of North Carolina, cheaters never win,” said US Attorney Ellis Boyle. “Our asset forfeiture team worked along with HSI to take the profit out of crime.”
The Department of Justice also acknowledged assistance from Tether in transferring the frozen assets.
How the Tether scam worked
The fraudsters appeared to rip the scheme from a page out of the “pig butchering” playbook, a type of scam that combines romance and fake investment opportunities.
In a typical scheme, fraudsters first “fatten the pig” by building fake online romances or friendships that can last weeks or months. Once trust is gained, they manipulate them toward fraudulent investment platforms and steal their money, what scammers refer to as “slaughtering the pig.”
In this case, investigators say criminal actors first built relationships with victims and then introduced them to what appeared to be lucrative cryptocurrency trading strategies.
Victims were then directed to fake trading platforms designed to closely mimic legitimate crypto exchanges. These sites displayed fabricated portfolios showing unusually strong returns, encouraging victims to increase their deposits.
The trap only became visible when victims attempted to withdraw funds, as scammers introduced demands for taxes or release fees to extract additional payments. In many cases, victims never recovered any of their original investment.
Once funds reached wallets controlled by the fraudsters, the money was routed through multiple cryptocurrency addresses in an effort to obscure ownership and origin.
HSI agents and analysts in Raleigh ultimately traced one victim’s transfers through this web of wallets, identifying several addresses which still held balances eligible for seizure.
“Criminal actors and professional money launderers use cyber-enabled fraud schemes to swindle their victims and conceal their ill-gotten gains,” said HSI Charlotte Acting Special Agent in Charge Kyle Burns.
“HSI special agents work diligently to trace the illicit proceeds of crime across the globe to disrupt and dismantle the transnational criminal organizations that seek to defraud hardworking Americans.”
Romance isn’t dead and fraud proves it
Romance-related scams are increasing in the UK, with figures from UK Finance showing romance fraud accounted for 35% of fraud cases in the first half of 2025.
According to the City of London Police and the National Fraud Intelligence Bureau, UK victims lost more than £106m to romance fraud in the most recent reporting year, with average losses exceeding £11,000.
Ahead of this year’s Valentine’s Day, Chargebacks911 pointed to how sophisticated these operations have become through a real case involving its UK and Europe Managing Director, Tracy Cray. She was targeted in a scam which lasted nearly nine months but chose to remain engaged to understand how it worked.
Cray found the activity resembled a coordinated network involving multiple scammers working in shifts, stolen identities, fake contracts, staged travel scenarios and carefully timed financial requests designed to gradually escalate pressure.
Given the sophisticated nature of these cases, alongside rising losses and volumes, these scams are becoming a significant challenge for payments companies and regulators.
Chargebacks911 warned many victims wrongly assume transactions can be easily reversed, but said recovery options become extremely limited once money is willingly transferred.
Meanwhile, Pay.UK noted since October 2024 APP fraud victims have been able to claim up to £85,000 back from banks and building societies under the reimbursement policy, with 88% of losses returned in the first year.
However, the organisation emphasised while reimbursement is an important layer of protection, prevention should be the main focus.
“Stronger payment infrastructure safeguards and better coordination among banks and payment providers on data-sharing and transaction information are vital for a resilient, fraud-proof ecosystem,” said David Morris, Chief Operating Officer at Pay.UK
“Initiatives like Pay.UK’s Confirmation of Payee (CoP) and EDEx, are crucial to combating new payment threats and supporting the evolving payment ecosystem.”
