American Economic Sanctions Imposed on Filipino Tech Business for Assistance in $200 Million Cryptocurrency Frauds
U.S. Treasury Imposes Sanctions on Funnull Technology and Administrator for Aiding Cryptocurrency Scams
A Philippine-based tech company, Funnull Technology Inc., and its administrator, Liu Lizhi, have faced sanctions from the U.S. Treasury's Office of Foreign Assets Control (OFAC) for aiding the infamous "pig-butchering" scams that defrauded American consumers of over $200 million.
In a statement issued on Thursday, lawmakers accused Funnull of providing the infrastructural backbone for various cryptocurrency scams by offering cybercriminals the necessary resources to host trickster websites. Liu Lizhi, a Chinese national, was also sanctioned due to his role as Funnull's administrator. He is said to have maintained records that tracked Funnull's employees' performances and activities, including the task assignment for domain name usage in phishing and fraudulent schemes.
The scams extended beyond consumer defrauding, with cybercriminals allegedly using Funnull's technology to victimize legitimate websites by injecting malicious code. This malicious code often redirected innocent users to fraudulent platforms. Funnull reportedly acquired IP addresses in bulk from global cloud providers, who then resold them to scammers responsible for setting up investment fraud, phishing, and online gambling websites.
"Funnull is linked to the majority of virtual currency investment scam websites reported to the FBI," the OFAC mentioned. "U.S.- based victims of these scam websites have reported over $200 million in losses, with average losses amounting to over $150,000 per individual." Treasury officials believe that the actual losses are higher due to underreported incidents of crimes.
"Pig-butchering" scams, so-named because of the gradual process of building rapport with a target before syphoning their assets, often originate on social media or dating apps. Scammers establish trust with the victim, then trick them into making digital asset transfers to scammer accounts or linking their crypto wallets to fake trading platforms for draining their funds.
The sanctions imposed on Funnull and Liu Lizhi represent the latest in a series of actions by the U.S. Treasury's OFAC targeting the infrastructure of financial cybercrimes. Previous instances include October's sanctions on Russia-based cybercrime syndicate, Evil Corp, and the March sanctions on Behrouz Parsarad, who ran the dark web platform Nemesis. In April, Tron Wallets linked to Iran-backed Houthi rebels were sanctioned.
Neither the Treasury Department nor OFAC immediately responded to Decrypt's requests for comment. The sanctions freeze all U.S.-based assets owned by Funnull Technology Inc. and Liu Lizhi, while also prohibiting U.S.-based individuals and businesses from engaging in transactions with entities that Funnull or Liu own more than 50% stake in.
- Funnull Technology Inc., a Philippine-based tech company, and Liu Lizhi, its administrator, have been sanctioned by the U.S. Treasury due to aiding cryptocurrency scams.
- Liu Lizhi, a Chinese national, was said to maintain records for Funull, tracking employee performances related to phishing and fraudulent schemes.
- Funnull reportedly provided the infrastructure for various cryptocurrency scams, allowing cybercriminals to host trickster websites.
- Beyond consumer defrauding, Funnull’s technology was used to victimize legitimate websites through malicious code injections, often redirecting users to fraudulent platforms.
- The OFAC stated that Funnull is linked to the majority of virtual currency investment scam websites reported to the FBI, with American victims reporting over $200 million in losses.
- The so-called "pig-butchering" scams, which originate on social media or dating apps, target individuals, build rapport, and trick victims into making digital asset transfers or linking their crypto wallets to fake trading platforms.
- This incident marks the latest in a series of actions by the U.S. Treasury to target the infrastructure of financial cybercrimes, with similar sanctions imposed on Evil Corp in October and Behrouz Parsarad in March.
- Recently, Tron Wallets linked to Iran-backed Houthi rebels were also sanctioned by the U.S. Treasury, demonstrating the ongoing efforts to combat crypto-related scams in the realm of finance and technology, including general-news and crime-and-justice sectors.
