In a shocking turn of events, Ken Liem, a California resident, has initiated a lawsuit against three Asian banks, namely Fubon Bank Limited, Chong Hing Bank Limited, and DBS Bank, for allegedly neglecting basic Know Your Customer (KYC) and Anti-Money Laundering (AML) protocols that could have prevented him from falling victim to a devastating crypto scam amounting to nearly $1 million.
The lawsuit, filed on December 31, 2024, outlines how Liem was lured into a pig butchering scam through a deceitful romantic façade. After being approached via LinkedIn in June 2023 with an alluring cryptocurrency investment opportunity, Liem’s trust was manipulated, leading him to transfer substantial funds to accounts purportedly managed by the involved banks.
According to the complaint, the failure of these banks to conduct adequate KYC and AML checks is not just a gross oversight; it is a violation of the U.S. Bank Secrecy Act. This legislation mandates financial institutions to monitor and report suspicious transactions to curtail fraud and money laundering, obligations that Liem claims these banks blatantly ignored.
Interestingly, other entities are also named in the lawsuit, including four Hong Kong-based firms—Richou Trade Limited, FFQI Trade Limited, Xibing Limited, and Weidel Limited—which allegedly opened accounts on Liem’s behalf and orchestrated the illegal movement of his funds to third-party accounts. Liem is pursuing a minimum of $3 million in damages, aiming to hold both the banks and these entities accountable for his financial losses, which reflect a growing trend of victims challenging the systems that are supposed to protect them.
This legal action highlights a darker side of the crypto market, particularly the rampant increase in pig butchering scams. Reports from the previous year indicate that such scams wiped out over $3.6 billion from the cryptocurrency sector, making them the most significant threat vector in 2024. Victims like Liem are turning to the courts in desperation to seek justice in a landscape where cash lost often leads to empty pockets and diminished hopes.
As cryptocurrency continues to evolve, the responsibilities of financial institutions grow ever more crucial. The outcome of Liem’s lawsuit may set a precedent for how banks approach KYC and AML regulations, particularly in relation to emerging digital assets.
