U.S. authorities seized approximately 127,271 Bitcoin valued at $14 billion and charged Chen Zhi, a dual UK-Cambodian national, with orchestrating what prosecutors describe as one of Asia's largest transnational criminal operations.
What to Know:
- •The U.S. Department of Justice calls this the largest Bitcoin seizure in history, part of what officials describe as one of the biggest financial takedowns ever conducted.
- •Prosecutors allege Chen Zhi's Prince Group operated at least 10 scam compounds in Cambodia where trafficked workers were confined in prison-like conditions and forced to conduct fraud schemes.
- •UK authorities froze assets from Zhi's network including a nearly £100 million office building in central London as part of a coordinated sanctions effort with U.S. officials.
Criminal Enterprise Spanning Continents
Chen Zhi, who remains at large, faces charges of wire-fraud conspiracy and money laundering through operations prosecutors say reached victims across multiple countries.
The Cambodia-based Prince Group presents itself publicly as a legitimate business engaged in property development and financial services.
Court documents dated Oct. 8 paint a different picture.
The Department of Justice alleges Zhi directed construction and operation of at least 10 facilities throughout Cambodia designed specifically to maximize victim outreach.
Two of these compounds housed 1,250 mobile phones that controlled approximately 76,000 social media accounts used exclusively for fraud.
Prosecutors presented evidence of what they term "phone farms" where accomplices acquired millions of phone numbers to support call center scams.
Assistant Attorney General for National Security John A. Eisenberg called the Prince Group "a criminal enterprise built on human suffering."
Workers were trafficked to these facilities under false promises of legitimate employment, then confined and threatened with torture if they refused to participate in the schemes.
The operations contacted potential victims online and persuaded them to transfer cryptocurrency with fabricated promises of investment returns and profits.
Internal Prince Group documents obtained by prosecutors included training materials advising workers to avoid using profile photos of women who appeared "too beautiful" to make fake accounts seem more authentic.
If convicted, Chen faces a maximum sentence of 40 years in federal prison.
Laundering Proceeds Through Luxury Assets
The Justice Department alleges Chen and his accomplices spent criminal proceeds on luxury travel, entertainment and what officials described as "extravagant" purchases.
These included watches, private jets and rare artwork.
Court filings specifically mention a Picasso painting acquired from a New York City auction house.
In Britain, Chen and associates allegedly established businesses in the British Virgin Islands and invested heavily in UK property.
The UK Foreign Office announced Tuesday that frozen assets include a £100 million office building in central London, a £12 million mansion in North London and 17 flats throughout the city.
UK Foreign Secretary Yvette Cooper said the network was "ruining the lives of vulnerable people and buying up London homes to store their money."
The coordinated sanctions by U.S. and UK authorities lock Chen out of both countries' financial systems.
Four businesses connected to the alleged operation received sanctions: The Prince Group, Jin Bei Group, Golden Fortune Resorts World and Byex Exchange.
The U.S. government formally labeled the Prince Group as a criminal organization.
An Amnesty International report published earlier this year specifically named two facilities allegedly operated by Jin Bei Group and Golden Fortune Resorts in its investigation of forced labor and torture at Cambodian scam centers.
The UK Foreign Office said these operations function on an "industrial scale" and deploy tactics including fabricated romantic relationships to manipulate victims.
Understanding the Cryptocurrency Connection
Bitcoin functions as a decentralized digital currency that operates without a central bank or single administrator.
Transactions occur directly between users through a peer-to-peer network, recorded on a public ledger called a blockchain.
The cryptocurrency's pseudonymous nature has made it attractive for both legitimate transactions and criminal activity, though all Bitcoin movements remain permanently recorded and traceable by law enforcement with proper resources.
The 127,271 Bitcoin now held by U.S. authorities represents one of the largest cryptocurrency seizures on record.
At current valuation of approximately $14 billion, the haul exceeds the total GDP of several small nations.
Prosecutors did not detail in court documents how authorities traced and seized the Bitcoin, though federal agencies have developed increasingly sophisticated methods for tracking cryptocurrency flows across blockchain networks.
Money laundering through cryptocurrency typically involves converting illicit proceeds into digital assets, then moving those assets through multiple wallets and exchanges to obscure their origin.
Criminals often convert cryptocurrency back to traditional currency through purchases of physical assets like real estate, artwork and luxury goods.
The pattern matches allegations against Chen's network, which prosecutors say funneled scam proceeds into high-value property and collectibles across multiple jurisdictions.
Coordinated International Response
Cooper emphasized the joint nature of the enforcement action.
"Together with our U.S. allies, we are taking decisive action to combat the growing transnational threat posed by this network - upholding human rights, protecting British nationals and keeping dirty money off our streets," the foreign secretary said.
The Foreign Office stated that Chen and the Prince Group constructed casinos and compounds serving as scam centers, then laundered proceeds through the international financial system.
Fraud Minister Lord Hanson added that "fraudsters prey on the most vulnerable by stealing life savings, ruining trust, and devastating lives.
We will not tolerate this."
The case marks an escalation in international cooperation targeting cryptocurrency-enabled fraud operations that rely on forced labor.
Victims of these schemes span multiple continents, with losses potentially reaching into the billions when accounting for unreported cases.
Looking Forward
The charges against Chen Zhi and sanctions against his business network represent what U.S. prosecutors characterized as historic enforcement action against cryptocurrency fraud.
The seizure of $14 billion in Bitcoin and freezing of nearly £100 million in London property demonstrate the scope of alleged criminal operations that prosecutors say exploited both trafficking victims forced to conduct scams and thousands of fraud targets worldwide.
With Chen still at large, authorities in multiple jurisdictions continue pursuing both the fugitive and additional assets connected to the Prince Group network.