U.S. Court Orders Forfeiture of $125,000 in Crypto Assets Linked to three Nigerian Nationals

A U.S. District Court has ordered the forfeiture of $125,000 in cryptocurrency linked to a fraud scheme involving three Nigerian nationals. The assets, believed to be proceeds from a scam targeting an American citizen, were recovered from three Binance accounts connected to Martins Eromosele Iyere, Moses Olumide Sokale, and Olawumi Stephen Adewale.

The ruling was delivered on April 30 by the Eastern District of Tennessee in Chattanooga, after months without any of the individuals stepping forward to claim the seized funds. The case stems from a 2021 incident in which Matthew McNulty, a Tennessee resident, was tricked into giving away his cryptocurrency wallet credentials through a fake website operated from Nigeria.

According to court documents, McNulty sought help on a Telegram channel for cryptocurrency users after experiencing a trading error. A scammer posing as a community manager directed him to a fraudulent website where he entered his login details. The site generated a QR code which McNulty was asked to screenshot and send back. That action enabled the scammer to access and empty his cryptocurrency wallet.

An FBI investigation led by Agent Jordan Foreman used open-source tools to trace the flow of the stolen funds. The cryptocurrency was laundered through multiple wallets, converted into various forms, and eventually landed in Binance accounts controlled by the three Nigerians. Foreman stated in an affidavit that the pattfern of transactions matched typical money laundering tactics and efforts to conceal the origin of illicit funds.

The court found sufficient evidence linking the seized assets to wire fraud and money laundering. With no one contesting the U.S. government’s claims, Judge Travis McDonough granted a summary judgment, allowing the forfeiture to proceed.

Binance, the cryptocurrency exchange involved in the case, was once widely used by Nigerian traders before facing increasing scrutiny from Nigerian authorities under President Bola Ahmed Tinubu’s administration beginning in 2023.