A Chinese tycoon, Chen Zhi, has been detained in Cambodia for his alleged involvement in a massive cryptocurrency fraud, which may have led to the theft of over $11 billion in Bitcoin. This arrest comes at the behest of the Chinese government as part of an effort to combat international crime.
Chen, who is the chairman of the Cambodia-based Prince Group, was taken into custody by local law enforcement on Tuesday and subsequently extradited to China. The Cambodian government confirmed the arrest in a statement, indicating their cooperation with Chinese authorities in tackling transnational criminal activities.
While details regarding any potential indictment by Chinese authorities remain unclear, reports state that the U.S. Justice Department had previously sought Chen’s arrest on charges including wire fraud and money laundering. In an operation that targeted vulnerable individuals, Chen allegedly orchestrated what is known as a “pig butchering” scam. This fraudulent method involves manipulating victims through fake online relationships before leading them to phony investment platforms, ultimately draining them of their funds as they attempt to withdraw money.
In October, U.S. authorities reported the seizure of approximately 127,271 Bitcoin linked to Chen, valued at about $15 billion at that time. Following the market fluctuation in Bitcoin, its value has since dropped by nearly 30%. Officials highlighted that the stolen cryptocurrency was channeled into extravagant personal expenditures, including luxury watches, high-end artwork, yachts, private jets, and real estate. Key assets frozen by the authorities include a multi-million dollar mansion in London and a prominent office building in the city.
Chen Zhi and Prince Group have denied all allegations against them. The lack of a formal extradition treaty between the United States and China raises considerable uncertainty regarding whether Chen will face charges in U.S. courts. Historically, extraditions between these two nations are infrequent and often require diplomatic arrangements rather than a systematic legal process.
Prosecutors allege that Chen ran extensive online scam operations that engaged trafficked workers, many of whom were coerced into labor under dire conditions. Victims of this scheme were led to believe they would gain legitimate employment but found themselves subjected to threats and violence if they failed to meet fraud quotas.
Investigative authorities in the U.S. have documented numerous cases where trafficked individuals were forced to execute scams while suffering from abuse and exploitation. In a federal court indictment, Chen was described as having operated under aliases, helping to develop a sprawling cyber-fraud empire that capitalized on human suffering.
U.S. officials characterize this scheme as one of the largest cryptocurrency frauds ever uncovered, draining victims of their life savings through a carefully orchestrated sequence of deceptive online interactions. Federal prosecutors are actively seeking to recover the seized cryptocurrency and are continuing their investigation into other members of this extensive criminal network.
