In short
- Chen Zhi, the alleged mastermind of a pig-slaughtering crypto fraud ring, was arrested in Cambodia.
- Zhi was indicted by the U.S. Department of Justice in October and charged with bank fraud and money laundering conspiracy.
- His crypto fraud network allegedly stole billions from users around the world, with nearly $12 billion worth of Bitcoin coming from operations now owned by the US government.
The alleged mastermind of a scam that stole billions of dollars in assets from individuals in the US and around the world was arrested in Cambodia on Tuesday and extradited to China, according to a Wall Street Journal report.
Chen Zhi, a Cambodian national and the founder and chairman of Prince Holding Group, was charged in October with bank fraud conspiracy and money laundering for his role in operating scam links that stole billions from victims.
As part of the scheme, Zhi’s conglomerate held individuals against their will at complexes and forced them to run crypto fraud schemes known as “pig slaughter,” building relationships with unsuspecting users before stealing their money. This scam gets its name from the process of fattening a pig before slaughtering it.
Zhi’s scam network grew its stolen proceeds to over 127,271 Bitcoin, worth approximately $11.6 billion today. Bitcoin prices. These funds, currently in the custody of the U.S. government, are wanted by the Ministry of Justice as part of the largest civilian seizure and forfeiture action in the department’s history.
In addition to the October indictment, the Justice Department designated Prince Group as a transnational criminal organization and imposed sanctions on Zhi and other associated individuals.
The indictment details that Zhi’s group trafficked hundreds of employees to multiple complexes in Cambodia to run their fraud network. He directly managed the connections and kept detailed records, while also guiding employees in using crypto to obscure the group’s profits.
Some of the proceeds were ultimately used by Zhi and his associates for luxury travel and extravagant purchases, including a painting by Pablo Picasso.
While the Zhi scam accounted for nearly $12 billion in seized funds linked to illegal activities, a report from Chainalysis indicates that on-chain crypto balances are linked to criminal activity amounts to more than $75 billion.
Illegal entities controlled nearly $15 billion in funds last July – a gain of more than 300% since 2020 – most of which came from stolen funds, the report said.
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