US prosecutors have charged Cambodia’s Prince Group with wire fraud and money laundering conspiracy, after seizing more than $14 billion in Bitcoin as part of one of the largest financial takedowns in history.
Summary
- US prosecutors have charged Cambodia’s Prince Group and its chairman, Chen Zhi, with wire fraud and money laundering.
- Prince Group was behind a huge crypto scam empire that used trafficked workers.
- Chen faces up to 40 years in prison if convicted.
Cambodia’s Prince Group is a conglomerate led by Chinese-Cambodian tycoon Chen Zhi, which presented itself as a legitimate multinational company spanning real estate development, finance and consumer services. However, according to the United States Department of Justice, it was all a facade to mask an extensive criminal empire that exploited thousands of victims through crypto scams, human trafficking and money laundering.
The Department of Justice has accused Chen, who serves as the group’s president and has dual citizenship of Cambodia and the United Kingdom, accuses him of orchestrating a massive transnational network created to defraud investors and launder illicit funds through a network of shell companies and fraudulent operations spread across Southeast Asia.
According to court documents, Chen was the man in charge of at least ten scam complexes in Cambodia, where trafficked workers were allegedly forced to carry out pig slaughter scams targeting victims around the world.
Cambodia is infamous for hosting this type of fraudulent compounds and is among the critical points for criminal operations in Southeast Asia, where countries such as Myanmar, LaosThe Philippines, Malaysia and Vietnam have also seen an increase in similar networks.
“Trafficked workers were confined in prison-like compounds and forced to conduct online scams on an industrial scale, preying on thousands of people around the world, including many here in the United States,” Assistant Attorney General for Homeland Security John A. Eisenberg said in an accompanying statement.
The compounds controlled by Chen reportedly housed “phone farms,” which were created by Chen’s accomplices who obtained millions of mobile phone numbers to reach as many victims as possible. Two of these farms, discovered during the crackdown, reportedly had 1,250 mobile phones that controlled around 76,000 social media accounts used for scams.
Authorities also discovered documents belonging to the Prince Group that laid out detailed blueprints on how to build trust with potential victims. The advice included using realistic social media personas, maintaining constant communication, and avoiding profile photos of women who were “too beautiful” to make the scam appear more genuine.
Prosecutors said Chen and his associates used the stolen profits to finance a lavish lifestyle that included private jets, luxury properties and rare works of art, while concealing the criminal origins of their wealth through complex money laundering channels, including their online gambling and cryptocurrency mining operations.
Under Chen’s direction, Prince Group members used sophisticated cryptocurrency laundering techniques, such as “sputtering” and “channeling.” Fumigation involves rapidly dispersing stolen assets across thousands of wallet addresses to make tracing difficult, while funneling concentrates these funds through intermediary wallets and exchanges before converting them into stablecoins or fiat currency.
Investigators believe the group relied on cryptocurrency mixers, over-the-counter brokers and offshore stock exchanges that allowed profits to circulate undetected through the global financial system.
Authorities seized approximately 127,271 Bitcoin from wallets controlled by Chen and his network, which are currently in custody under US jurisdiction as the investigation continues.
Chen faces up to 40 years in prison if convicted, according to the Justice Department, and remains free. Authorities have not revealed his whereabouts, but international efforts are reportedly underway to locate and arrest him.
Meanwhile, Price Group has been labeled a transnational criminal organization, and those associated with the group have been sanctioned in the United States.
Last year, the U.S. sanctioned a separate Cambodian business empire led by tycoon and senator Ly Yong Phat for running similar crypto scam operations that exploited trafficked workers.
