How Did This Romance Scam Compound Steal $100M Crypto?

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Romance Scam Compound Steals Over $100M in Crypto
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Chainalysis has revealed discoveries regarding KK Park, Myanmar’s notorious pig butchering facility, where $100 million was stolen by coercing the families of its workers into transferring cryptocurrency.

Approximately 2,000 trafficked workers are believed to be present there. The report details how the facility would extort the families of trafficked workers. This was done through demanding crypto in exchange for their loved ones’ freedom.

Romance Scam Leads to $100M in Stolen Crypto

A recent report indicates that the two ransom wallet addresses are linked to a Chinese front company belonging to a pig butchering gang operating out of KK Park.

“We know that they take crypto payments from scam victims. But Heintz also told us that pig butchering gangs will often tell the families of trafficked workers to pay them ransoms in exchange for their family member’s freedom — those payments also often happen in cryptocurrency.”

Chainalysis presents a graph outlining that two main ransom addresses receive the majority of funds. One of these addresses receives funds from scams like pig butchering schemes. Meanwhile, the other receives crypto from family members of human trafficking victims.

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Chainalysis Reactor Graph With Addresses On-Chain Activity. Source: Chainalysis

The estimated total across the two wallets exceeds $100 million.

However, Chainalysis was unable to ascertain the percentage derived from ransom payments and fraudulent activities.

Read more: 15 Most Common Crypto Scams To Look Out For

However, given that these are just two addresses from a single company operating out of KK Park, Chainalysis declares that on “the whole, pig butchering scammers working out of the compound are making significant sums.”

Escape from Romance Crypto Scam Compound Poses Challenge for Workers

Other reports indicate that due to its remote location in Southeast Asia, KK Park makes it extremely challenging for workers to flee the compound. The only option is their family members agreeing to ransom demands, often involving cryptocurrency.

However, many workers who ended up there were unaware of the true nature of the situation; some believed they were accepting legitimate job offers.

Satellite Image of KK Park. Source: Chainalysis
Satellite Image of KK Park. Source: Chainalysis

However, the crypto industry remains focused on scams, with the amounts stolen from victims increasing rapidly.

This is partly due to the global adoption of digital assets.

Read more: How To Identify a Scam Crypto Project

On January 30, BeInCrypto reported that the US DoJ charged three individuals for their involvement in a fraudulent crypto scheme. They face accusations of scamming individuals out of nearly $2 billion.

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