US authorities have charged two foreign nationals with laundering $73 million in cryptocurrency investment scams, commonly known as “pig butchery.” This development was announced on Friday by the US Department of Justice (DOJ), with an indictment unsealed in the Central District of California against the two suspects.
$73 Million Cryptocurrency Laundering Scheme Dismantled
In a Press release, the DOJ has confirmed the identity of the two suspects in a cryptocurrency laundering case: two Chinese nationals named Daren Li and Yicheng Zhang, aged 42 and 38 respectively. Li, who is a dual citizen of China and St. Kitts and Nevis, was apprehended on April 12 at Hartsfield-Jackson Atlanta International Airport and then transferred to the Central District of California. Meanwhile, Zhang was arrested in California on Thursday in Los Angeles.
The two men are accused of participating in a pig butchery scam, in which fraudsters convince victims to invest large sums of money in a purported cryptocurrency scheme. Once the investment is substantial, the scammers disappear with the funds, leaving victims with significant losses.
Court documents reveal that Li and Zhang ran an international syndicate that laundered the proceeds of these crypto scams. Victims are tricked into transferring large sums to American bank accounts controlled by front companies. Subsequently, these funds are transferred to international and local accounts, as well as cryptocurrency exchanges in an attempt to hide the source or transaction history of these ill-gotten gains.
So far, more than $73 million has been transferred to shell accounts at Deltec. Bank in the Bahamas, where it was converted to Tether (USDT). Additionally, a cryptocurrency wallet received over $341 million in virtual assets as part of this scam.
Commenting on the case, Deputy Attorney General Lisa Monaco said:
Cryptocurrency investment scams exploit the borderless nature of virtual currency and online communications to defraud victims.
Monaco also added:
These arrests, made possible with the assistance of our international and U.S. partners, reflect the Department of Justice’s continued commitment to disrupting the entire cybercrime ecosystem and stopping fraud on all financial markets.
Currently, Li and Zhang face charges of conspiracy to commit money laundering and six counts of international money laundering. If convicted, they could each face a maximum sentence of up to 20 years in prison per count.
Featured image from iStock, chart from Tradingview
