Florida prosecutors seize $1.5 million worth of cryptos as part of a fraud investigation linked to a Chinese national

Florida’s Attorney General James Uthmeier has announced the seizure of approximately $1.5 million in cryptocurrency assets linked to an investment scam in Citrus County. The seizure occurred under the Fugitive Disentitlement Act, which allows authorities to confiscate assets from individuals who are fugitives from justice. 

The recovery comes as Florida lawmakers are proposing new regulations to combat rising crypto ATM scams, which defrauded Americans of $240 million in the first half of the year.

Florida crypto scam victim gets justice 

According to Uthmeier, the Office of Statewide Prosecution’s Cyber Fraud Enforcement Unit made the seizure of cryptocurrency worth $1.5 million in a money laundering case against a Chinese national.

The seized assets are reportedly intended to be returned to the victim upon conclusion of the legal process. 

In a statement announcing the seizure, Uthmeier expressed pride in the ability of the Statewide Prosecutors to adapt, which ultimately helped them deliver justice. In his statement, he thanked Florida’s Cyber Fraud Enforcement Unit and the Citrus County Sheriff’s Office for their continued dedication and “for making this fraudster’s victim whole again.” Uthmeier said. 

The investigation began in July 2024 when a report was filed with the Citrus County Sheriff’s Office in which the victim, a Citrus County resident, reported he had been scammed out of $47,421 USD via an internet-based investment scheme.

The investigation that followed the revelation saw Tu Weizhi, a citizen of China, charged with money laundering, grand theft, and an organized scheme to defraud. Weizhi currently walks free in China, but there are plans to arrest him if he ever attempts to enter the U.S. 

A seizure warrant was also filed in the Fifth Judicial Circuit to recover Weizhi’s entire cryptocurrency wallet, valued at approximately $1.5 million, which contained AVAX (Avalanche), DOGE (Dogecoin), PEPE (Pepe), and SOL (Solana) cryptocurrency tokens.

As earlier stated, the seizure occurred under the Fugitive Disentitlement Act, which allows courts to move against assets tied to a criminal case even though a defendant is situated outside the jurisdiction. The Act ensures the suspect’s ability to use Florida’s courts to contest forfeiture can’t be exercised unless they appear to face the charges.

“This isn’t the first time U.S. law enforcement has seized assets in absentia, but what’s notable is how comfortably those doctrines now extend to crypto,” Angela Ang, head of policy and strategic partnerships for Asia Pacific at TRM Labs, said.

Florida is struggling with crypto-based scams 

Florida has ramped up efforts to curb crypto crimes and scams this year. However, despite the best efforts of the government and law enforcement, scams are still quite rampant. Just last month, Okaloosa County reported over $1.1 million lost to similar investment frauds, and recent reports claim Florida lawmakers have started considering new safeguards designed to curb rising crypto ATM scams.

As things stand, crypto ATM machines operate with barely any oversight or regulation, which has made them a prime tool for scanners that have been used to target mostly senior citizens, according to law enforcement. 

Data from the FBI claims that Americans lost up to $240 million to crypto ATM scams in the first half of this year. 

How do crypto ATM scams work? The fraudsters convince victims to withdraw cash from their bank accounts and deposit it into crypto ATMs. However, once the money is inserted into the machine, it is converted into a virtual currency that cannot be tracked and is rarely recovered. 

During a hearing in Tallahassee on Tuesday, a Hillsborough County Sheriff’s Deputy testified that he covered cases last year that saw victims lose a combined $13 million to crypto schemes. Several of those cases, according to Master Deputy Jeffrey Merry with the Hillsborough County Sheriff’s Office, involved seniors. 

To curb this, Florida officials have proposed BH 505, a bill that would require crypto kiosks to display clear warnings explaining the tactics fraudsters use to direct victims to the machines. 

The bill would also put a cap on how much customers can deposit, with new customers limited to $2,000 per day, while existing customers would be limited to $10,500 in a single day. There are currently no transaction limits at all. 

The machines will also be forced to provide printed receipts with the company’s contact information. And in certain situations where theft is reported quickly, the proposal covers a refund process. The bill has bipartisan support in the House and has passed unanimously in a House Insurance & Banking subcommittee.

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