U.S. authorities have taken control of the BG Wealth Sharing website after investigators linked the group to a suspected crypto investment fraud that left users with heavy losses. According to reports from ZachXBT, onchain data traced wallets tied to the operation attempting to move more than $92 million in crypto between April 27 and May 3. Coordinated action involving Tether, Binance, OKX, and U.S. law enforcement resulted in over $41.5 million being frozen from the platform's operations, with Tether blacklisting $38.4 million in USDT on May 4, 2026. The seizure notice displayed on the website confirms the domain has been taken over by U.S. authorities as part of Operation Level Up and the Scam Center Strike Force.
As reported by ZachXBT, the scheme may account for losses exceeding $150 million, citing activity traced back to 2025 and "thousands of victim exchange withdrawals" identified through on-chain analysis. The operation targeted retail users through social media channels, where victims were encouraged to trust the platform despite warning signs. Figures released by the Federal Bureau of Investigation in April showed that cyber-enabled crimes led to $21 billion in losses last year, with crypto investment scams forming a significant portion of the total. The scheme operated as a fake AI-powered crypto trading platform paired with BG Wealth Sharing, an MLM-style investment group that promised 1.3% to 2.6% daily returns through referral commissions and rank-based bonuses.
Regulatory alerts had already flagged the platform months earlier. In April, the Central Bank of Samoa described BG Wealth Sharing as an investment scam and advised the public to stay away, noting that the company operated without a license. As reported by affected users, a person identified as CEO Stephen Beard told participants in a video message that the platform's DSJ Exchange was preparing for an initial public offering and required a 12% tax on account balances to proceed. By Sunday, users began posting warnings online that withdrawals were being restricted, with several claiming the platform had stopped processing requests. The scheme recruited victims through BonChat, a Hong Kong messaging app, with operators likely generating the "Professor Stephen Beard" persona using AI technology. The fact that the fraudulent entity created a fake identity for the leader, used a rotating network of infrastructure, and recruited via social media made the scam hard to trace.
According to reports, the Washington State Department of Financial Institutions confirmed it had received complaints and warned that the operation showed signs of fraud. The regulator stated that any platform requiring additional deposits before allowing withdrawals is "highly likely to be operating an advance fee scam," reinforcing concerns raised by affected users. The Reserve Bank of Tonga flagged BG Wealth Sharing as early as December 2025, followed by warnings from the Central Bank of Samoa, Alberta Securities Commission, Utah Division of Securities, and UK Financial Conduct Authority in March 2026. Despite warnings from six or more jurisdictions, the scheme kept operating and collecting funds until U.S. law enforcement seized the domain on April 23, 2026. A total of thirteen regulators in five continents had issued public warnings against DSJ and BG prior to the collapse.
The $41.5 million in frozen funds represents a partial recovery of the $92 million laundered across Ethereum and Tron chains between April 27 and May 3, 2026. Operators used complex laundering methods including Tokenlon swaps, Bridgers, Butter Network, and USDT0 bridges, consolidating funds across hundreds of addresses before depositing into Cobo custody ($63 million) and OKX ($30 million). ZachXBT coordinated with Tether, Binance Security Team, and OKX to identify and freeze laundered funds, with the initiative intercepting roughly 45% of the laundered funds. However, returning assets to victims will likely require lengthy legal proceedings, as authorities have not identified the real operators behind the scheme and no arrests have been announced. US victims are urged to file reports at ic3.gov, while victims in other jurisdictions should file police reports locally.
