Two Chinese Nationals Indicted for Involvement in Multi-Million Dollar Investment Fraud Scheme
Two individuals, identified as Daren Li and Yicheng Zhang, have been arrested and indicted for their alleged participation in a sophisticated investment fraud scheme that involved laundering millions of dollars through cryptocurrency scams. The suspects are accused of managing an international network that operated under the guise of “pig butchering.”
Daren Li, a dual citizen of China and St. Kitts and Nevis, was apprehended at Hartsfield-Jackson Atlanta International Airport on April 12 and taken into custody in the Central District of California. Yicheng Zhang, a Chinese national residing in Temple City, California, was arrested in Los Angeles on May 16.
According to authorities, Li and Zhang instructed their associates within the network to establish bank accounts using the names of shell companies. The illicitly obtained funds were then transferred to bank accounts at Deltec Bank in The Bahamas, with Li allegedly assisting in the operation of at least one of these accounts. The money was subsequently converted into cryptocurrency and stored in digital wallets, including one managed by Li himself. Zhang also received funds directly, as per the Department of Justice (DoJ).
Prosecutors have obtained evidence suggesting that Li and Zhang orchestrated the activities of the network, overseeing the actions of lower-level members and discussing the network’s commission structure. The DoJ also possesses a video showing a conspirator in the group contacting a US bank.
The fraudulent scheme, known as pig butchering, involves scam artists gradually gaining the trust of their victims before enticing them to invest in a cryptocurrency venture. Despite the appearance of growth in their investments, victims later discover that the funds have been siphoned off to the scammers’ accounts.
Li and Zhang are facing charges of conspiracy to commit money laundering and international money laundering. If convicted, they could be sentenced to a maximum of 20 years in prison. The DoJ alleges that the duo helped launder over $73 million through US financial institutions, with part of the funds being converted into the virtual asset USDT (Tether). However, one of the cryptocurrency wallets involved in the operation received more than $341 million in virtual assets, indicating a wider scope of illegal activities.
