U.S. Moves to Forfeit $7.1M in Crypto Tied to Oil & Gas Fraud Scheme
Please note that we are not authorised to provide any investment advice. The content on this page is for information purposes only.
The U.S. Attorney’s Office in Seattle has filed a civil action seeking the forfeiture of over $7.1 million in cryptocurrency linked to a complex oil and gas investment scam that spanned multiple countries. The crypto funds were traced to shell entities and digital wallets in Russia and Nigeria. Homeland seized them in December.
Crypto-Funded Oil Storage Scam Unraveled in U.S. Forfeiture Case
According to the filing, the scheme defrauded victims out of nearly $97 million between June 2022 and July 2024, offering fake investment opportunities in oil and gas ventures.
The perpetrators posing as oil storage providers targeted investors by promoting escrow accounts allegedly tied to oil tank storage facilities in Rotterdam and Houston.
Victims wired funds to seven shell companies, including Apex Oil and Gas Trading LLC and Green Tree Gateway LLC. Once payments were made, the fraudsters disappeared, providing no further communication or returns.
“The co-schemers in this fraud moved their ill-gotten gain through various cryptocurrency accounts to try to launder the money stolen from victims,” Acting U.S. Attorney Miller explained in the filing.
The funds were routed through 81 financial accounts and at least 19 crypto wallets. Much of the stolen money was converted into Bitcoin, Ethereum, Tether, and USD Coin, eventually funneled to Binance and lesser-known exchanges in Russia and Nigeria, some of which are suspected of laundering money for transnational criminal syndicates.
One suspect, Geoffrey K. Auyeung, a resident of Newcastle, Washington, was indicted last year. He allegedly received millions in proceeds and converted them into crypto to obscure the money trail.
https://twitter.com/WDWAnews/status/1947724669454295338
Investigators have so far identified dozens of victims and recovered over $9.4 million, including $2.3 million in cash. If approved, the crypto forfeiture will go toward victim compensation.
This is a legal process that allows authorities to confiscate assets linked to crime without the need of criminal conviction. It has become a key method in cases involving cryptocurrency, where funds are often quickly moved and concealed.
A New Case for Stronger Crypto Laws and Stablecoin Oversight
The recent oil and gas scheme can be seen as the tip of the iceberg in terms of crypto fraud.
Fraudsters continue to exploit the crypto industry’s opaque nature to conceal illicit funds, but law enforcement is fighting back harder than ever.
The DoJ and other federal agencies have significantly boosted collaborative efforts to hunt suspicious transactions and claw back stolen funds. Here, forensic blockchain analysis led to a civil forfeiture, allowing the seizure of assets without needing a criminal conviction.
Enforcement continues to escalate dramatically. In 2023 alone, authorities recovered $112 million from pig butchering rings. Then came June 2025’s bombshell.
A staggering $225.3 million seizure from international crypto fraud networks, marking the Secret Service’s biggest crypto bust ever. These wins didn’t come easy.
They required painstaking blockchain tracing and unprecedented interagency teamwork, showing how investigators are rapidly upskilling in digital asset tracking.
Nonetheless, the damage done by these cybercriminals is substantial. FBI data reveals crypto investment scams drained over $5.8 billion from victims in 2024 alone.
Criminals are becoming increasingly crafty, exploiting the perceived anonymity of blockchain to fleece investors. Some argue that regulation will stifle innovation, but the current losses suggest that existing safeguards are insufficient. To curb these, Washington is planning tougher rules.
A bipartisan Senate proposal from late 2023 aims to impose bank-level AML requirements on crypto firms.
While purists complain about overreach with these sorts of rules, the reality is clear – without proper guardrails, fraud will continue to flourish.
Authorities are now pursuing a dual strategy that involves the ruthless enforcement against active scams, which they now pair with smarter regulations to prevent new ones. Crypto’s decentralized architecture still presents hurdles, but recent successes show progress.
In its continuous efforts to clampdown cybercriminals, the US Treasury recently sanctioned North Korean and Russian operatives for funding missile programs through IT work. One of the suspects was accused of helping IT workers secure jobs in the US.
