A California resident, Ken Liem, has filed a lawsuit against three Asia-based banks, accusing them of negligence in a crypto scam that cost him nearly $1 million. The lawsuit, submitted to a California district court on December 31, 2024, alleges that the banks failed to perform basic compliance checks, enabling fraudsters to exploit their systems.
The case stems from what Liem’s attorneys describe as a “pig butchering scam,” a sophisticated fraud where victims are groomed over time before being coerced into fraudulent investments. According to the lawsuit, Liem was contacted via LinkedIn in June 2023 and persuaded to transfer funds to accounts at Hong Kong’s Fubon Bank and Chong Hing Bank, as well as Singapore’s DBS Bank. These funds were then funneled into third-party accounts controlled by the scammers.
Liem’s legal team argues that the banks neglected their duties under Know Your Customer (KYC) and Anti-Money Laundering (AML) regulations, failing to identify red flags that could have prevented the fraud.
Banks Allegedly Complicit in Crypto Scam Activities
The lawsuit further accuses the banks of violating the U.S. Bank Secrecy Act, which mandates financial institutions to maintain detailed transaction records and report suspicious activity. Liem’s attorneys claim the banks “turned a blind eye” to the illicit transfer of funds from the United States to Asian entities, facilitating the crypto scam.
Specific Hong Kong-based entities—Richou Trade, FFQI Trade, Xibing, and Weidel—are also named in the lawsuit. These entities allegedly misrepresented the purpose of the funds, claiming they were for cryptocurrency investments while diverting them to unauthorized accounts.
The lawsuit contends that DBS Bank’s California branch and the involvement of U.S. bank Wells Fargo in processing the transactions establish jurisdiction under U.S. law. Liem’s legal team is seeking a jury trial and a minimum of $3 million in damages.
Call for Accountability
The case underscores growing concerns about the role of financial institutions in combating cryptocurrency fraud. Liem’s attorneys have criticized the banks for their apparent lack of due diligence, arguing that even basic checks would have exposed the accounts’ suspicious nature.
As of now, the accused banks—Fubon Bank, Chong Hing Bank, and DBS Bank—have not responded to the lawsuit. The outcome of this case could set a precedent for holding financial institutions accountable in the escalating battle against crypto scam cases.
