US Moves to Forfeit $7.1M in Crypto Tied to Oil and Gas Fraud Scheme

• U.S. authorities seek to forfeit $7.1 million in crypto tied to a fraudulent oil and gas investment scheme.

• The scheme involved laundering funds through crypto accounts linked to individuals in Russia and Nigeria.

• One person has been indicted, and over $9.4 million in assets have been seized for victim restitution.

The U.S. Department of Justice is pursuing the forfeiture of $7.1 million in cryptocurrency linked to a fraudulent oil and gas investment scheme allegedly draining nearly $97 million from victims between June 2022 and July 2024.

The action, filed by the Seattle U.S. Attorney’s Office, targets digital assets seized by Homeland Security Investigations (HSI) in December. Prosecutors claim the funds were laundered through various crypto accounts belonging to individuals based in Russia and Nigeria. These actors allegedly converted investor funds into crypto, moved them across wallets, and transferred portions to exchanges within their jurisdictions.

One Indictment and Millions Seized

Geoffrey Auyeung was indicted in August 2024 in connection with the scheme. Authorities allege he was central in laundering proceeds for transnational criminal networks. Auyeung reportedly acquired Bitcoin (BTC), Tether (USDT), USD Coin (USDC), and Ether (ETH) using the illicit funds, routing much of the crypto to Binance.

U.S. authorities seized approximately $2.3 million from Auyeung’s bank accounts at the time of his arrest. If approved, the new $7.1 million forfeiture would raise the total recovered amount to $9.4 million, which will be redistributed to verified victims.

According to the Justice Department, the scheme promised investors lucrative returns by renting oil tank storage facilities. However, once funds were transferred, victims reportedly received no further communication, and their investments disappeared.

So far, prosecutors have confirmed losses of $17.9 million. Officials expect more claims to emerge as additional victims are identified and verified.

Global Crackdown on Crypto Fraud

The case is part of a broader enforcement push targeting crypto-related fraud. U.S. prosecutors charged two individuals linked to OmegaPro, a $650 million global scam, in July. If convicted, they each face up to 40 years in prison.

On July 19, former rugby player Shane Donovan Moore was sentenced to 30 months in a U.S. federal prison for operating a Ponzi scheme that stole $900,000 from over 40 investors.

Meanwhile, Hong Kong police arrested four people on July 18 concerning a $382,000 crypto fraud. Authorities reported the main suspect fled the region.

The Justice Department’s continued pursuit of bad actors reflects growing global pressure to police fraud in digital assets, especially where cross-border transactions and blockchain anonymity create enforcement challenges.