US Cracks Down on Philippine Crypto Scam Factory—Turns Out Crime Doesn’t Pay After All

In a move that shocked exactly zero crypto natives, the US Treasury just sanctioned a Philippines-based firm for running an industrial-scale crypto fraud operation. Because nothing says ’legitimate financial services’ like offshore boiler rooms.

The hammer drops

OFAC slapped the unnamed company with asset freezes and transaction bans—turns out building infrastructure for pig-butchering scams violates those pesky international finance laws. Who knew?

Web3’s dark underbelly

While DeFi degens chase the next 100x memecoin, these shadow ops remind us crypto’s wild west days aren’t over. Just relocated to tropical jurisdictions with lax oversight.

Final thought: Maybe this explains why that ’VIP trading group’ DM suddenly stopped replying...

Crypto scamming and phishing 

According to Treasury officials, Funnull purchased IP addresses in bulk from cloud service providers and resold them to scammers hosting fake investment platforms and phishing sites. It also used domain generation algorithms to mass-produce web addresses and provided design templates, helping cybercriminals impersonate legitimate financial services.

In 2024, Funnull reportedly tampered with a code repository used by developers to secretly reroute web traffic from legitimate sites to scams and gambling platforms, some linked to Chinese money laundering operations.

Liu Lizhi allegedly managed operations at Funnull, including overseeing staff who assigned domains to scammers and maintained infrastructure supporting fraud, phishing, and illicit gambling.

The Treasury’s action follows a September 2023 alert by its Financial Crimes Enforcement Network warning of pig butchering scams and their ties to Southeast Asian crime groups exploiting victims of labor trafficking to carry out fraud.