The U.S. Treasury Department sanctions the armed group KNA Myanmar and its leader for orchestrating cryptocurrency scams, including 'pig butchering', causing billions of dollars in damages.
On May 5, the Office of Foreign Assets Control (OFAC) of the U.S. Treasury imposed sanctions on the armed group Karen National Army (KNA) operating in Myanmar, along with the group's leader – Mr. Saw Chit Thu – and his two sons, due to their involvement in transnational criminal activities, including financial fraud through cryptocurrency and human trafficking.
According to the official statement, KNA is accused of operating multiple sophisticated cryptocurrency fraud campaigns, prominently featuring the 'pig butchering' tactic – a form of fraud through establishing fake relationships to build trust, then luring victims to invest in fraudulent cryptocurrency projects.
OFAC describes these activities as not only causing severe harm to U.S. citizens but also linked to human trafficking and illegal cross-border transportation.
Although OFAC did not disclose specific damages directly related to KNA, the U.S. Treasury emphasized that scams originating from Myanmar have caused a total of billions of dollars in losses to American citizens. KNA primarily operates in southeastern Myanmar, near the Thai border - an area believed to be a hotspot for digital scam activities combined with human trafficking networks.
Notably, in official documents, the U.S. government and many international organizations continue to refer to 'Burma' instead of 'Myanmar' as a form of protest against the military government that renamed the country following the coup in 1989.
OFAC's designation of KNA as a sanctioned entity is part of the United States' expanded strategy to prevent the use of blockchain technology and digital assets for illegal purposes. Recently, OFAC has repeatedly sanctioned terrorist organizations in the Middle East, global cybercrime networks, as well as privacy-focused tools like the Tornado Cash mixing service.
The issue of scams related to digital assets is becoming a pressing problem in the U.S. According to a report from the Federal Bureau of Investigation (FBI), in 2024, American citizens suffered a total loss of $9.3 billion due to cryptocurrency-related scams – a 66% increase compared to 2023. The elderly group (over 60 years old) is the most severely affected, with total losses reaching $2.8 billion.
The specific tactic of 'pig butchering' is currently recording a significant level of damage. Blockchain analysis company TRM Labs estimates that in 2023, this method has appropriated more than $4.4 billion globally. The U.S. Treasury Department stated that most of the networks conducting this scheme are based in Southeast Asia, often linked to forced labor, where victims are coerced into participating in the fraud process.