Federal prosecutors in Boston have initiated a civil forfeiture proceeding to recover approximately $3.44 million in Tether (USDT) linked to a sophisticated social engineering scam. The scheme, which began in late 2024, defrauded victims across multiple U.S. states by starting with seemingly innocent "wrong number" messages on platforms like WhatsApp and Telegram.
The fraud followed a methodical "pig-butchering" model, where scammers spent weeks or months building trust through friendly, non-financial conversations. Once a rapport was established, they pitched an exclusive investment opportunity that combined the growth potential of Ethereum's Ether (ETH) with the perceived stability of gold.
Victims were instructed to purchase Ether on legitimate exchanges themselves and then transfer it to wallets provided by the fraudsters. This step gave victims a false sense of control and legitimacy. After receiving the Ether, the scammers routed the funds through multiple intermediary wallets, converted them into USDT, and moved them to unhosted wallets to obscure the trail.
Authorities launched an investigation following victim complaints and, by early 2025, had seized the $3.44 million in USDT. The civil forfeiture action allows the government to seek permanent ownership of the assets without requiring a criminal conviction, offering a potential path for victim restitution.
