Washington State Takes Legal Action to Seize $7.1 Million in Cryptocurrency Linked to Fraud

Washington State recently initiated a legal effort to seize $7.1 million in digital assets associated with an international fraud operation centered around fake oil investments. The scheme has attracted victims with enticing promises of high returns but has proven to be fraudulent.

This civil action, supported by the Department of Justice and Homeland Security Investigations, aims at crypto wallets reportedly utilized to launder the funds from investors. The primary suspect, Geoffrey K. Auyeung, is already facing criminal charges and could be sentenced to a maximum of 200 years in prison.

Inside the Oil Storage Scam: Crypto, Shell Companies, and Global Laundering Fraud

Investigations reveal that this intricate scheme spans across countries, disguised within fictitious oil investment opportunities. Between August 2022 and August 2024, scammers persuaded victims to invest in oil storage units located in key cities like Rotterdam and Houston using persuasive pitch materials that assured significant rental profits. However, the entire venture was just a facade.

Victims transferred their funds into what they believed were valid escrow accounts linked to shell companies such as Sea Forest International LLC and Apex Oil and Gas Trading LLC.

$7.1M in Crypto Tied to Oil & Gas Scam Targeted by U.S. Prosecutors
The U.S. Attorney’s Office for the Western District of Washington has filed a civil action seeking to recover approximately $7.1 million in cryptocurrency linked to an oil and gas investment fraud scheme.… Source

Upon receiving the funds, communication from the scammers ceased. Investigators report that over $97 million was siphoned off through 81 financial institution accounts and 19 different crypto wallets, with transactions occurring in Bitcoin, Ethereum, Tether, and USDC. Some transactions were traced to high-risk exchanges suspected of involvement in global money laundering networks, including operations based in Russia and Nigeria. Some of these assets even ended up on Binance.

The fraud has already left numerous investors in distress, with confirmed losses exceeding $17.9 million, a figure that could rise. Many victims were drawn in by a false sense of security stemming from what appeared to be institutional authenticity and regulated escrow arrangements.

U.S. looks to grab $7.1M in crypto from oil and gas investment scam
The U.S. Department of Justice is seeking to seize $7.1 million in cryptocurrency linked to a $97 million oil and gas investment scam. The scheme, active from June 2022 to July 2024, Source

The operation, however, functioned as a cross-border criminal stream, using cryptocurrency as the final layer for laundering. This fraud reveals how criminals adapt their methods to leverage the evolving digital asset infrastructure, igniting discussions about compliance and wallet traceability for centralized exchanges in a post-FTX regulatory landscape.

Forfeiture Justice and What Comes Next for Victims and Crypto Oversight

On July 22, 2025, the U.S. Attorney’s Office filed a civil action to reclaim the $7.1 million in cryptocurrency related to the scam, building upon a prior seizure of $2.3 million from bank accounts during Auyeung’s arrest in August 2024. The legal initiative aims to recover and redistribute the seized funds to victims, contingent upon court approval. Authorities had initially confiscated the cryptocurrency in December 2024, and they have included the targeted wallets in the expanding collection of evidence.

Geoffrey K. Auyeung, aged 47 and from Newcastle, Washington, remains the focal point of the DOJ’s investigation, alleged to have received the majority of the ill-gotten gains. Indicted last year, Auyeung is now facing a potential 200-year sentence.

U.S. authorities seized over $7.1 million in cryptocurrencies linked to a $97 million oil tank rental scam. The fraud involved laundering through 19+ crypto wallets and 81 bank accounts worldwide. Lead suspect Geoffrey K. Auyeung faces up to 200 years in prison. Source

As the civil forfeiture process unfolds, the criminal case against Auyeung and others is also advancing. Authorities expect additional victims may come to light, and forensic analysis will likely uncover further cryptocurrency assets. This case underscores the necessity for thoroughness and compliance within the cryptocurrency investment landscape, emphasizing that regulators are closely monitoring developments.