Client Alert: U.S. Attorney’s Office for the District of Columbia Signals Major Expansion of Cryptocurrency Fraud Enforcement with Announcement of Scam Center Strike Force

KEY TAKEAWAYS

• The USAO-DC, in conjunction with other federal law enforcement partners, has launched the District of Columbia Scam Center Strike Force, the first Department of Justice (DOJ) led enforcement group dedicated to dismantling Southeast Asian crypto-fraud operations.
• Due to unprecedented losses from fraudulent cryptocurrency scams (150,000 victims and $9.3 billion stolen in 2024 alone, a 66% annual increase), DOJ officials, Federal Bureau of Investigations (FBI) leadership, the U.S. Secret Service, and other federal partners, are coordinating to dismantle transnational “pig-butchering” cryptocurrency investment scams, disable U.S. infrastructure exploited in cryptocurrency scams, and pursue fraudulent scheme organizers abroad through the creation of the Scam Center Strike Force.
• Companies connected to digital-asset activity should expect more aggressive expectations around fraud monitoring, reporting, infrastructure security, and public-private cooperation.

 

BACKGROUND

At a press conference on November 12, 2025, U.S. Attorney Jeanine Pirro announced the creation of the Scam Center Strike Force, a new initiative aimed at protecting the U.S. from cryptocurrency-related fraud and scams originating in Southeast Asia. U.S. Attorney Pirro explained that Chinese transnational criminal organizations (TCOs) are using cryptocurrency investment scams to steal money from Americans.  According to U.S. Attorney Pirro, these scammers often gain the trust of their victims via U.S. social media or text messages, leading them to invest in real cryptocurrency, which is later transferred to fake websites. While some of these sites are hosted in the U.S., the stolen funds are quickly laundered overseas. These scams, called “pig butchering” (because they “fatten” victims up before stealing their savings), are typically run from criminal compounds in Southeast Asia.

Authorities report that many workers involved in these operations are victims of human trafficking. The scam industry has become so lucrative that, in some countries, it accounts for nearly half of their GDP. In response, Federal enforcement agencies have accelerated efforts to combat cryptocurrency-related fraud affecting U.S. consumers, many of whom are older adults lured into long-running confidence schemes. Officials estimate these schemes may total more than $10 billion in annual losses to Americans.

TASK FORCE FOCUS AREAS

The Scam Center Strike Force is focused on disrupting U.S.-based, consumer-facing crypto-investment fraud, impersonation schemes, and deceptive trading platforms, while enhancing federal-state coordination to accelerate enforcement responses and improve public guidance. The task force is also increasing outreach on emerging fraud patterns and high-risk solicitation tactics, particularly romance-based and social-media schemes that disproportionately target the elderly. Complementing this domestic focus, the Scam Center Strike Force combines the resources of DOJ, FBI, the U.S. Secret Service, Department of Treasury’s Office of Foreign Assets Control (OFAC), the State Department, and the Commerce Department to dismantle transnational crypto-investment schemes by pursuing organizers abroad, seizing digital assets, and disabling U.S. infrastructure such as hosting services, cloud platforms, communication tools, and social-media accounts used to facilitate scams.

The Strike Force has already carried out coordinated operations in Cambodia, Laos, Burma, Bali, and Thailand. These efforts have included embedding FBI agents with local task forces and executing significant actions, such as seizing and forfeiting $401,657,274.33 in cryptocurrency, initiating new forfeiture proceedings for an additional $80 million, shutting down scam-hosting websites at the Tai Chang compound in Burma, and aiding in the prosecution of 38 Indonesian nationals linked to Bali-based scam centers that targeted over 150 U.S. victims. OFAC simultaneously designated the Democratic Karen Benevolent Army (DKBA) and related entities as specially-designated nationals, blocking assets and prohibiting U.S. transactions based on evidence of torture, electric shocks, beatings, and other abuses within scam compounds.

U.S. Attorney Pirro emphasized that these operations reflect a “generational wealth transfer from Main Street America into the pockets of Chinese organized crime” and underscored the need for strong public-private partnerships. She noted that companies such as Meta, Microsoft, and AARP have already committed to enhanced cooperation to help secure domestic infrastructure from misuse.

IMPLICATIONS FOR COMPANIES INVOLVED IN CRYPTOCURRENCY TRANSACTIONS

The creation and rapid deployment of the Scam Center Strike Force reflects heightened federal scrutiny of companies operating in or around digital-asset markets. Companies should expect more proactive suspicious-activity reporting and increased cooperation during investigations, including assistance in disabling U.S.-based infrastructure used by scam networks. Companies that fail to act promptly on fraud complaints or that allow misuse of their platforms face heightened civil and criminal exposure, potential regulatory or sanctions-related inquiries, and increased reputational, operational, and litigation risk as federal attention and victim reporting continue to rise. As a result, companies involved in cryptocurrency transactions or consumer digital-asset services should reassess and strengthen their compliance frameworks to align with the expanding enforcement landscape.

CONCLUSION

The launch of the Scam Center Strike Force represents an escalation in the U.S. government’s efforts to combat digital-asset fraud. With billions in losses, widespread victim impact and major seizures underway, companies should expect sustained federal attention and should reassess compliance, reporting, and fraud-mitigation protocols accordingly. Sher Tremonte LLP will continue to monitor developments related to DOJ enforcement policies.  If you have any questions about these policies or your obligations, please contact us.  Written by Brian Kidd and Taylor Fontan.