Feds Freeze $7.1M in Crypto Following Takedown of $97M Global Oil Scam—Blockchain’s Paper Trail Strikes Again
When oil meets crypto, the slickest scams rise to the surface. US authorities just proved blockchain’s forensic edge by tracing millions through the immutable ledger.
How Crypto Played Both Villain and Hero
The DOJ’s asset recovery team followed the digital breadcrumbs—$7.1 million worth—after busting an international fraud ring peddling fake oil investments. Classic boiler room tactics, but with a 21st-century twist: crypto payouts.
Why This Matters Beyond the Headlines
While Wall Street still debates blockchain’s utility, law enforcement keeps quietly weaponizing its transparency. Every tainted transaction stays etched on-chain—making ‘exit scams’ far harder than in offshore bank accounts.
The irony? These scammers picked crypto for its ‘anonymity,’ only to gift prosecutors an auditable money trail. Maybe they should’ve stuck with unmarked bills—or better yet, not stolen $97 million from greedy investors chasing ‘guaranteed’ oil returns.
Key suspect used Binance for crypto transfers
One person, at least, is said to have assisted money laundering activities by transnational crime groups. Geoffrey Auyeung was indicted and charged in August 2024 with Core participation in laundering stolen funds. Court records show that he used the stolen funds to purchase Bitcoin, Ether, USDT, USDC, and moved most of the sums to Binance. At the time of his arrest, $2.3 million was confiscated in his US accounts.
According to the Department of Justice, Auyeung and co-conspirators appealed to be authentic investment managers who WOULD provide huge profits in oil tank leasing activities. Upon raising funds, they shut down communication with investors. So far, prosecutors have uncovered more than $17.9 million in direct losses, although more victims are anticipated to emerge as the investigation process proceeds.
DOJ ramps up crypto fraud enforcement
The Seattle case is part of a broader crackdown by U.S. authorities targeting crypto-related financial crimes. Recent court filings revealed the DOJ seized $2 million in USDT and Binance-based assets linked to Hamas. Investigators traced the funds through a Gaza-based money transfer business known as BuyCash, which allegedly helped finance the group’s activities.
Other fraud cases are also coming into the limelight. Shane Donovan Moore, a former rugby player, was sentenced to two and a half years in federal prison after operating a Ponzi scheme using a crypto mining company as a bogus front. Between 2021 and 2022, Moore defrauded more than 40 investors of almost $900,000 through his firm Quantum Donovan LLC.
In another case, a Denver-based pastor and his wife face 40 criminal charges regarding a crypto-based investment scheme based on faith that robbed people of over $3 million. The indictment cites the ongoing abuse of trust-based networks in seeking crypto funds.
According to FBI data, digital asset fraud is on the rise. Victim losses grew by almost two times, reaching $4 billion in 2023 compared with $2.57 billion in 2022. The number ROSE to $5.8 billion in 2024.
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