USDC Stablecoin Issuer Circle Accused of Refusing to Help Scam Victims: Report
Crypto giant Circle is under fire for allegedly refusing to assist law enforcement in helping scam victims recover stolen funds, according to a report by the International Consortium of Investigative Journalists (ICIJ). The report cites unnamed law enforcement officials who claim the USDC stablecoin issuer has declined to freeze or recover assets suspected to be scam proceeds.
In southeastern Wisconsin, state prosecutors filed a criminal complaint against Circle, alleging the company refused to comply with a warrant to recover a scam victim’s stolen assets. Circle responded by calling the complaint meritless and seeking dismissal. Milwaukee County police detective Scott Simons reported witnessing over a dozen instances across the US where Circle either denied requests to freeze victim funds or failed to act on court orders due to delays.
New York prosecutors also claimed in a letter to Congress that Circle ignored court orders to reimburse victims. The letter states, “Circle’s motive for not assisting law enforcement becomes crystal clear: it is financially preferable to only freeze cryptocurrency deemed to have been stolen, but not return the underlying asset to law enforcement or any fraud victim, because Circle can continue to collect the interest through investment of the underlying funds.”
The allegations highlight ongoing tensions between crypto firms and regulators over accountability and victim protection.