Interpol seizes $97M from crypto scams as Circle considers reversing stablecoin transactions

Law enforcement keeps sending signals about its ability to confiscate crypto assets worth tens of millions of USD, while major stablecoin issuer Circle has confirmed it's looking into the possibility of reversing transactions.

Interpol said it has recovered $342 million in traditional currencies stolen via financial crime schemes and $97 million in crypto assets. The seizures were the result of HAECHI VI, a major operation lasting from April through August this year and involving 40 countries and territories.

According to Interpol, almost 400 crypto wallets were frozen, while "in addition, around USD 16 million in suspected illicit profits was recovered" from wallets. However, the traditional finance infrastructure still dominates among criminals, as more than 68,000 bank accounts were blocked as part of the HAECHI VI operation.

Law enforcement agencies in the participating countries targeted criminals behind voice phishing, romance scams, online sextortion, investment fraud, money laundering linked to illegal online gambling, business email compromise, and e-commerce fraud.

"While many people believe that funds lost to fraud and scams are often irretrievable, the outcomes of HAECHI operations demonstrate that recovery is indeed possible," Theos Badege, interim Director of Interpol’s Financial Crime and Anti-Corruption Centre, was quoted as saying.

Meanwhile, centralized stablecoin users, such as those holding tether (USDT) and USD coin (USDC), who are already aware that their funds can be frozen, might think twice before using these tokens.

Circle, the issuer of USDC, said it is examining possibilities to reverse transactions with the stablecoin.

The company’s president, Heath Tarbert, former chief of the US Commodity Futures Trading Commission, told the Financial Times that it is "thinking through. . . whether or not there’s the possibility of reversibility of transactions" in cases of fraud, while stressing that at the same time they want settlements to remain final.

According to Tarbert, unspecified software developers are discussing whether "on certain blockchains, for certain circumstances, provided all the parties agree, there could be some degree of reversibility for fraud."

No further details about these discussions and plans were provided.

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