The U.S. government has imposed sanctions on a technology company based in the Philippines for supplying the digital infrastructure that facilitated large-scale cryptocurrency investment scams, which defrauded American victims of over $200 million. According to a press release from the U.S. Department of the Treasury on Thursday, May 29, Funnull Technology Inc. operates from the Philippines and supports "hundreds of thousands" of websites involved in virtual currency investment scams, commonly referred to as "pig butchering" scams.
The company's administrator, Liu Lizhi, a Chinese national, has also been sanctioned.
"Today's action highlights our commitment to disrupting criminal enterprises like Funnull, which facilitate these cyber scams and rob Americans of their hard-earned savings," stated Deputy Treasury Secretary Michael Faulkender in a press release.
According to the U.S. Department of the Treasury, Funnull is linked to the majority of virtual currency investment scam websites reported to the FBI, with individual victims losing an average of $150,000 each. The company operated by purchasing IP addresses in bulk from major global cloud service providers and then selling them to cybercriminals for hosting fraudulent investment platforms.
According to the US Department of Treasury, "These services not only facilitate cybercriminals in impersonating trusted brands to create scam websites, but they also enable quick changes to different domain names and IP addresses when legitimate providers try to shut down these sites." Last year, the company allegedly acquired legitimate web developer code repositories and "maliciously altered" them to redirect unsuspecting visitors to gambling sites and fraudulent platforms.
According to the press release, some of these platforms are linked to "Chinese criminal money laundering operations." The U.S. Department of the Treasury collaborated with the Federal Bureau of Investigation on this initiative. They have since issued a cybersecurity advisory that includes technical information about Funnull's infrastructure, aimed at assisting private companies in identifying and shutting down related websites.
The sanctions impose a freeze on any U.S.-based assets owned by Funnull and Liu while also prohibiting American individuals and businesses from engaging in transactions with them. Violating these sanctions may lead to civil or criminal penalties.
In September 2023, the U.S. Treasury's Financial Crimes Enforcement Network issued a warning regarding these "pig butchering" scams.
