US sanctions tech firm tied to multi million dollar crypto scam operations

The US government on Thursday imposed sanctions on Funnull Technology Inc.
Tools provided by Funnull made it easier for fraud networks to switch domains and evade detection.
Under the sanctions, all US-based assets or interests tied to Funnull or Liu are blocked.

The US government on Thursday imposed sanctions on Funnull Technology Inc, accusing the company of supporting widespread cryptocurrency scams that have defrauded American victims of more than $200 million.

The Treasury Department’s Office of Foreign Assets Control (OFAC) said Funnull, based in the Philippines and run by Chinese national Liu Lizhi, provided critical infrastructure for so-called “pig butchering” scams.

These schemes typically involve cybercriminals cultivating online relationships, often romantic, to lure victims into investing in fraudulent cryptocurrency ventures.

The agency said Funnull is “linked to the majority of virtual currency investment scam websites reported to the FBI.”

According to the Treasury, these scams result in average individual losses of more than $150,000.

Officials noted that actual losses may be significantly higher, as many victims never report the crimes.

“Today’s action underscores our focus on disrupting the criminal enterprises, like Funnull, that enable these cyber scams and deprive Americans of their hard-earned savings,” said Deputy Secretary of the Treasury Michael Faulkender.

Digital infrastructure for fraud

Funnull’s services include selling bulk-purchased IP addresses and domain generation tools that allow scammers to rapidly deploy new websites.

The company also offers web design templates that help impersonate trusted brands, Treasury said.

These tools make it easier for fraud networks to switch domains and evade detection.

“Funnull generates domain names for websites on its purchased IP addresses using domain generation algorithms,” the department stated.

“These services not only make it easier for cybercriminals to impersonate trusted brands… but also allow them to quickly change to different domain names and IP addresses when legitimate providers attempt to take the websites down.”

In 2024, Funnull is said to have altered a developer code repository to redirect users from legitimate websites to scam or gambling sites, some of which have alleged links to Chinese money laundering networks.

Sanctions and their impact

Liu Lizhi, identified as Funnull’s administrator, was also sanctioned.

According to the Treasury, Liu managed operational records, including documents that tracked employee assignments and domain name usage for scams involving cryptocurrency fraud, phishing, and online gambling.

Under the sanctions, all US-based assets or interests tied to Funnull or Liu are blocked.

US persons and entities are prohibited from engaging in any transactions involving the sanctioned parties unless explicitly authorized by OFAC.

The FBI, which has issued alerts on pig butchering schemes, reiterated that Funnull’s operations supported thousands of fraudulent sites and continue to pose a risk to American investors.