Warren calls out crypto ‘pig butchering’ scams in Armed Services panel hearing

In a recent Senate Committee on Armed Services hearing, U.S. Senator Elizabeth Warren raised alarms about the threats posed by Asian criminals engaging in ‘pig butchering’ scams and North Korea’s use of cryptocurrency to fund its weapons program, emphasizing the significant risks these activities pose to national security.

During the hearing, Warren questioned Admiral John C. Aquilino, Commander of the U.S. Indo-Pacific Command, and General Paul J. LaCamera, Commander of the UN Command, ROK/US Combined Forces Command and United States Forces Korea, on the growing influence of cryptocurrency in facilitating illicit activities.

Warren highlighted North Korea’s exploitation of cryptocurrency to finance its nuclear weapons program, citing the staggering $1.7 billion worth of crypto stolen by North Korea in 2022.

The Massachusetts lawmaker pointed out that this amount is equivalent to funding more than 56 intercontinental ballistic missile (ICBM) tests, underscoring the direct threat posed by crypto-funded proliferation of weapons.

“These are long-range missiles that North Korea desperately wants because it could give them the ability to target the U.S. mainland,” said Warren.

Aquilino acknowledged the concerning nature of these developments, scams soliciting funds through cryptocurrency, indicating a pervasive trend of criminal exploitation using digital currencies.

“I have over 200 fake websites put out on me every month, of which many are soliciting dollars from people who can be fooled,” said Aquilino.

LaCamera also shared insights into the ‘pig butchering’ crypto scams, where fraudsters target individuals through fake online relationships and deceive them into investing in fraudulent schemes.

LaCamera said ‘pig butchering’ crypto scams which have harmed over 40,000 Americans and cost them over $3.5 billion last year alone.

Both military commanders agreed that addressing the ease with which rogue states and criminals can use cryptocurrency for illicit purposes is crucial for enhancing international security.

Warren emphasized the urgent need for legislative action to curb these threats, highlighting a bipartisan bill she sponsors that aims to restrict the misuse of cryptocurrency by criminal organizations, terrorists, and rogue states. She urged Congress to pass the bill to prevent further financing of illegal activities through digital currencies.

“Crypto is the way this stuff is financed,” said Warren. “And it’s helping rogue states. It’s helping terrorists. It’s helping criminal organizations fund their operations on a scale like we have never seen before.”

The senator added that her bipartisan bill would “put a stop to it.”

Warren’s bill, called the Digital Asset Anti-Money Laundering Act, aims to stop crypto crime by beefing up U.S. financial regulation of cryptocurrency and expanding know-your-customer protocols, among other requirements.

In addition to discussing crypto-related risks, Warren raised concerns about the lack of transparency in military budget justifications, urging Aquilino to provide the necessary information to Congress as mandated by law. She emphasized the need to prioritize national security resources effectively and avoid unnecessary distractions that could benefit defense contractors.

The Senate hearing shed light on the multifaceted challenges posed by crypto-enabled crimes and the nexus between digital currencies, national security threats, and illicit financing, highlighting the imperative for legislative and strategic responses to safeguard U.S. interests.