The Justice Department has successfully seized approximately $15 billion in bitcoin from a widespread fraud operation known as “pig butchering,” attributed to a Chinese-born businessman. This complex scheme involved forced labor in Cambodia, where victims were coerced into executing fraudulent operations. The illicit proceeds from this enterprise financed the purchase of luxury goods including fine artwork, high-end watches, and expensive real estate.
In a federal court in Brooklyn, 37-year-old Chen “Vincent” Zhi, the founder and chairman of Prince Holding Group, has been indicted on multiple charges, including wire fraud, bribery, and conspiracy to launder money. Prosecutors contend that Chen’s operations have persisted for nearly a decade.
The Department of Justice claims Chen oversaw “phone farms” in Cambodia, using trafficked individuals who were forced into what is termed “pig butchering.” This method typically involves luring potential victims online through fake emotional engagements or promises of high returns on cryptocurrency investments.
Despite the nature of his activities, Chen received accolades such as the ‘Leading Personality of the Year’ award at the Global Economics Awards in Cambodia last year, as mentioned on Prince Holding Group’s website. The DOJ has detailed that Chen employed violence to maintain control and discipline within the scam operations, which were characterized as forced labor camps.
According to the indictment and forfeiture complaint, since late 2014, Chen has transformed Prince Group into one of Asia’s foremost criminal enterprises, under the guise of a legitimate entity engaging in real estate, finance, and consumer services across over 30 countries. The gains from this operation funded extravagant purchases, including yachts, private jets, luxury watches, and even a Picasso painting procured in New York.
Legal proceedings indicated that a Brooklyn-based network groomed over 250 victims in the U.S., laundering millions of dollars for Chen. In response to the severity of the allegations, the British government announced intentions to impose sanctions against him. Properties under scrutiny include a $16 million mansion and a $126 million office space in London’s financial district.
Chen reportedly built trust with victims through online platforms, coaxing them into transferring cryptocurrency, which was subsequently misappropriated. Court documents reveal that at the peak of his operations, Chen’s enterprise was generating upwards of $30 million daily.
Allegations suggest that the scam facilities were fortified with high walls and barbed wire, creating an environment of fear where workers conducted multi-billion dollar fraud schemes under threat of violence. The DOJ asserts Chen was deeply involved in managing these operations, even possessing images documenting the physical abuse and intimidation tactics used to maintain order among his workforce.
The indictment cites that scams often initiated contact with potential victims via messaging apps and social media avenues, promising lucrative investment returns in cryptocurrency. The seized bitcoin, amounting to around 127,271 coins, was stored in unhosted wallets controlled by Chen and has now been placed in U.S. custody.
Although now internationally recognized as a significant figure in this fraudulent scheme, Chen remains at large and faces a potential maximum sentence of 40 years in prison if convicted. The price of Bitcoin was reported to be $112,327 earlier this week.
Evidence presented in the indictment purportedly includes photographs that depict the harsh conditions and treatment of laborers under Chen’s direction. Furthermore, the indictment references an accomplice who allegedly secured millions of mobile numbers and account details from illicit online sources to assist in the fraud.
In a broader context, U.S. authorities have linked Chen and his associates to widespread political corruption, claiming they used their influence to obscure their criminal activities and launder money through various means, including gambling and cryptocurrency mining operations.
The announcement of Chen’s indictment coincided with the Treasury Department designating Prince Group as a “transnational criminal organization” and implementing sanctions against Chen and his cohorts. The urgency of this case reflects a growing concern over investment fraud, particularly in the realm of cryptocurrency, which reportedly incurred losses exceeding $5.8 billion in the previous year, according to the FBI’s 2024 Internet Crime Report.
