California resident Ken Liem has accused three Asian banks of failing to protect him from a $1 million crypto scam, due to neglecting KYC and AML checks.
Incident Overview
Ken Liem filed a lawsuit against Fubon Bank Limited, Chong Hing Bank Limited, and DBS Bank. He claims to have fallen victim to crypto scammers who redirected his funds to accounts maintained by these banks after being approached on LinkedIn in June 2023. The scammers pretended to be romantic partners or trusted connections to persuade Liem into transferring nearly $1 million.
Allegations Against Banks
The lawsuit claims that the banks failed to conduct proper KYC and AML checks, which could have flagged suspicious activities and prevented the fraud. Additionally, Liem argues the banks violated the U.S. Bank Secrecy Act because DBS Bank operates a branch in California, while Fubon Bank and Chong Hing Bank allegedly processed transactions through his U.S.-based Wells Fargo account.
Fraud Extent
The accusation also involves four Hong Kong-based entities accused of opening accounts in Liem's name and illegally redirecting his funds to third-party accounts. Liem seeks at least $3 million in damages. Globally, pig butchering scams emerged as the largest threat in 2024, extracting over $3.6 billion from the crypto sector.
This case emphasizes the need for stringent security measures and banking regulations to prevent such fraud schemes in the future.
