U.S. Seeks Forfeiture of $7.1 Million in Crypto From Alleged Oil and Gas Investment Scam
Federal prosecutors in Seattle have initiated a civil forfeiture action to reclaim over $7 million in cryptocurrency allegedly tied to a fraudulent oil and gas investment scheme. The move aims to eventually return the seized assets to defrauded victims, according to a Tuesday announcement by the U.S. Attorney’s Office for the Western District of Washington.
U.S. commences civil action to forfeit $7.1 million in cryptocurrency tied to oil and gas storage fraud scheme – Crypto seized from wallets tied to Russian and Nigerian IP addresses https://t.co/LoCQb0yC06
— WDWAnews (@WDWAnews) July 22, 2025
The case marks the latest effort by U.S. authorities to crack down on financial crime involving cryptocurrency and highlights the increasing role of digital assets in cross-border fraud schemes.
Alleged Scheme Spanned Two Years and Net Nearly $100 Million
According to prosecutors, the alleged scam operated between June 2022 and July 2024, collecting approximately $97 million from investors who were led to believe they were participating in a lucrative oil and gas venture. The investment opportunity claimed to involve the purchase and leasing of oil tank storage facilities, promising substantial returns.
However, investigators say that once funds were transferred, the fraudsters ceased communication with victims, abandoning the original business narrative.
“The co-schemers in this fraud moved their ill-gotten gain through various cryptocurrency accounts to try to launder the money stolen from victims,” said Acting U.S. Attorney Teal Luthy Miller. The office filed a civil action to seek forfeiture of $7.1 million in crypto that was seized in December 2024 by Homeland Security Investigations (HSI).
Crypto Accounts Traced to Russia and Nigeria
Authorities say the cryptocurrency funds were moved through multiple accounts belonging to individuals residing in Russia and Nigeria. These individuals allegedly used the victims’ funds to purchase Bitcoin (BTC), Ether (ETH), Tether (USDT), and USD Coin (USDC) and then transferred a portion of the assets to crypto exchanges in their home countries.
The civil action seeks to formally confiscate the crypto from these accounts, which prosecutors say represent a portion of the fraudulently acquired funds. The goal is to ultimately redistribute the recovered money to verified victims through a restitution process.
One U.S.-Based Individual Indicted
In connection with the scheme, Geoffrey Auyeung was indicted in August 2024. He is accused of serving as a key facilitator of the money laundering operations for what law enforcement described as transnational criminal organizations.
According to the indictment, Auyeung received a substantial portion of the scheme’s proceeds, which he used to purchase various cryptocurrencies. Authorities allege he directed the majority of those assets to Binance, one of the world’s largest cryptocurrency exchanges.
Upon his arrest, U.S. officials seized approximately $2.3 million from his personal bank accounts.
Total Victim Losses Exceed $17 Million
Prosecutors say they have identified victims who were defrauded out of a combined $17.9 million so far, but expect that number to grow as additional claims are filed and verified. If the court grants the civil forfeiture request, the total amount recovered would rise to $9.4 million, which could then be allocated among the eligible victims.
The Department of Justice emphasized that the forfeiture process is a critical tool for recovering and returning stolen funds in financial crime cases involving cryptocurrency.
Broader Regulatory Crackdown on Crypto Fraud
The Seattle case is part of a wider trend of enforcement actions targeting crypto-related fraud schemes. In recent weeks, U.S. and international authorities have announced multiple arrests and prosecutions involving digital asset scams:
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Earlier this month, two promoters of the OmegaPro scheme were indicted by U.S. prosecutors. They allegedly ran a global investment fraud that defrauded investors of $650 million. If convicted, they could face up to 40 years in prison.
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On Friday, former professional rugby player Shane Donovan Moore was sentenced to 30 months in U.S. federal prison for operating a $900,000 Ponzi scheme that defrauded over 40 investors.
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Last Thursday, Hong Kong police arrested four individuals involved in a crypto investment scam that stole HK$3 million (approximately $382,000). However, the operation’s suspected mastermind reportedly fled the jurisdiction.
These developments come amid heightened scrutiny of the crypto sector, as regulators seek to strengthen consumer protection and prevent the misuse of digital assets in criminal enterprises.
Moving Forward
While cryptocurrency remains a powerful tool for innovation in finance and technology, it has also proven attractive to criminals seeking to launder funds across borders. The U.S. government’s continued efforts to investigate and prosecute such schemes reflect the growing need for robust enforcement mechanisms and international cooperation.
The Seattle U.S. Attorney’s Office reiterated its commitment to tracking illicit cryptocurrency activity and ensuring that “victims of fraud are made whole whenever possible.”
The civil forfeiture case is ongoing, and no trial date has been announced. Victims of the scheme are encouraged to come forward to assert claims to the funds once the recovery process is formally initiated.
