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A sweeping US investigation has revealed one of the largest cryptocurrency fraud schemes ever recorded. Prosecutors allege Chinese businessman Chen Zhi was the mastermind behind the operation. Zhi used his Cambodia-based conglomerate, Prince Group, which spanned more than 30 countries and generated billions in losses. The case has garnered global attention due to its scale and the involvement of forced labor networks.
According to court filings from the Eastern District of New York, Chen’s organization ran at least ten fraud hubs across Cambodia. These centers lured victims through deceptive “pig-butchering” scams - online relationship schemes that encouraged individuals to invest in fake cryptocurrency platforms.
The fraudsters reportedly gained victims’ trust through months of communication before convincing them to deposit funds into fraudulent exchanges. Once the transfers occurred, the victims’ money vanished into untraceable crypto wallets controlled by Chen’s network.
The government reported that the criminal organization earned up to 30 million dollars a day at its height. The embezzled cash had been laundered into shell companies and acquired assets, including personal jets, boats, and expensive wristwatches. Researchers also tracked the funding to real estate, gambling businesses, and cryptocurrency mining enterprises that appeared legal.
The US Treasury and British authorities imposed sanctions on Chen, the Prince Group, and related entities. These actions froze international assets and barred US citizens from conducting financial transactions with the organization.
Investigators uncovered evidence of forced labor camps supporting the scheme. Trafficked individuals were coerced into maintaining online scams for long hours under threat and violence. Victims reported physical abuse, confinement, and intimidation.
Photographs included in the indictment showed injured workers with lash marks and bruises in overcrowded dormitories. Officials said Chen personally approved an assault on one laborer, allegedly warning subordinates not to “beat him to death.”
The human trafficking aspect has augmented international criticism. The exposures shed light on the fact that digital crime networks tend to rely on exploitation to finance large-scale financial fraud. The collaboration of US and UK agencies is a significant milestone in breaking down such systems.
The US Department of Justice (DOJ) has confiscated 127,271 Bitcoin, which is worth more or less $14 billion, as well as other luxury goods associated with Chen. The authorities characterized the operation as one of the most extensive asset confiscations in crypto history.
On a related note, another Cambodian conglomerate, the Huione Group, was reported by the Financial Crimes Enforcement Network (FinCEN) to be a significant conduit for laundering. The network handled over $ 4 billion in suspicious transactions and allegedly enabled North Korean hacker syndicates to steal over $ 37 million.
FinCEN affirmed that the US financial system has been disconnected from Huione. Meanwhile, Chen is still on the loose after being suspected of hiding in Cambodia and would be sentenced to 40 years in jail if he is found guilty.
Read more: Jawed Habib and His Son Accused in Rs. 100 Crore Crypto Scam, 400 Investors Affected
The US investigation into Chen Zhi’s $14B crypto scam exposes a vast network of deceit, forced labor, and money laundering. Authorities seized over 127,000 Bitcoin and imposed global sanctions on Prince Group and related entities. The FinCEN crackdown also identified Huione Group’s $4B laundering link.
