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Xinmei Shen

The US and China are ramping up crackdowns on cryptocurrency-related cross-border crimes with a flurry of actions against the suspected ringleaders of scam networks operating in Southeast Asia.
In recent years, the border areas between Thailand, Myanmar, Laos and Cambodia have become hubs for online fraud operations, in which syndicates either trick or coerce their targeted victims to invest in bogus schemes and transfer money via bitcoin, ether or stablecoins before these are processed through complex money-laundering networks.
Those schemes reflect the major role played by cryptocurrencies in sophisticated criminal enterprises in spite of the increased integration of digital assets in mainstream finance.
After seizing US$13.4 billion worth of bitcoin from China-born Cambodian tycoon Chen Zhi last month, the US Department of Justice (DOJ) on Wednesday said that it was launching a Scam Center Strike Force to combat crypto investment fraud that targets Americans.
The task force’s creation represented a “landmark initiative” and “the clearest statement yet” that the US intends to fight these transnational criminal networks “with the full power of the state”, blockchain analytics firm TRM Labs wrote in a report on Wednesday.
Southeast Asian scam syndicates have defrauded Americans of nearly US$10 billion per year, the DOJ said on Wednesday.

Separately, China’s Ministry of Public Security on Wednesday said that it had extradited She Zhijiang, a Chinese national accused of operating illegal casinos, who was arrested by Thai police in August 2022.
The ministry said on Wednesday that it would “proactively work towards setting up an international alliance to combat telecoms and cyber fraud”, deepening law-enforcement cooperation with countries around the world.
Chinese President Xi Jinping said during his meeting with US counterpart Donald Trump in Busan, South Korea, last month that there was “good potential for the two countries to work together” on areas including anti-money-laundering activities.
Chinese police said last month that it was working with UK law enforcement authorities to track down fugitives and illicit funds involved in the case of Chinese businesswoman Qian Zhimin, and “doing everything possible” to help more than 128,000 Chinese investors recover their losses.
Between 2014 and 2017, Qian operated a web of fraudulent wealth schemes in China before converting the scammed funds into bitcoin. After entering the UK, she attempted to further launder the proceeds. She was arrested last year and pleaded guilty in London in September.


Such enforcement actions have also carried out some of the largest cryptocurrency seizures in history. In 2018, British police seized digital wallets holding more than 61,000 bitcoin as part of its investigation into Qian.
Last month, the DOJ said that it had seized 127,271 bitcoin from Prince Holding Group chairman Chen Zhi, who was charged with wire fraud conspiracy and money laundering conspiracy for running forced-labour scam compounds across Cambodia. Chen’s firm on Wednesday broke its silence, saying that it “categorically rejects” the allegations.
The US seizure of the privately held bitcoin, which surpasses US$13 billion in value, had prompted frantic speculation about how it was achieved and even drew attention from a Chinese state-run cybersecurity centre.
The National Computer Virus Emergency Response Centre said in an article on Sunday that the seizure was achieved by US “state-level hacker groups”, which already gained control of the funds in 2020.


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Cryptocurrency

US, China ramp up actions against transnational crypto scam syndicates

Cryptocurrencies like bitcoin play a major role in sophisticated criminal enterprises that involve complex money-laundering networks. Photo: Shutterstock 

She Zhijiang, who is accused by Beijing of running illegal online gambling operations, is escorted by police at Suvarnabhumi International Airport in Thailand’s Samut Prakarn province ahead of being extradited to China on Wednesday. Photo: AP

15 in court over Hong Kong’s record HK$1.6 billion cryptocurrency fraud

Joseph Lam Chok, centre, leaves Eastern Court after being granted bail over his alleged role in the HK$1.6 billion JPEX cryptocurrency scandal. Photo:  Karma Lo

YouTuber Chan Wing-yee, 38, leaves Eastern Court after being released on bail. Photo: Karma Lo

China, UK police join forces to recover funds from massive crypto fraud

British police in 2018 seized digital wallets holding more than 61,000 bitcoins as part of an investigation. Photo: Shutterstock

Funds of more than 128,000 Chinese investors were caught in a web of fraudulent wealth schemes perpetrated by a syndicate between 2014 and 2017. Photo: Shutterstock

Hong Kong businesses lose US$11 billion to digital fraud in past year, TransUnion says

More than half of the Hong Kong respondents to a TransUnion survey are “extremely” or “very” concerned about the business impact of fraud. Photo: Shutterstock

A screenshot from an anti-fraud video campaign by the Hong Kong Monetary Authority. Photo: Handout

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Syndicates either trick or coerce targeted victims to invest in bogus schemes and transfer funds via bitcoin, ether or stablecoins


Syndicates either trick or coerce targeted victims to invest in bogus schemes and transfer funds via bitcoin, ether or stablecoins.


US, China ramp up actions against transnational crypto scam syndicates

.css-1c6uqr6{color:inherit;font-weight:inherit;font-size:inherit;font-family:inherit;line-height:inherit;overflow-wrap:break-word;}Syndicates either trick or coerce targeted victims to invest in bogus schemes and transfer funds via bitcoin, ether or stablecoins

Syndicates either trick or coerce targeted victims to invest in bogus schemes and transfer funds via bitcoin, ether or stablecoins