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Ruholamin Haqshanas
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Ruholamin Haqshanas
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Daren Li, a 41-year-old dual citizen of China and St. Kitts and Nevis, pleaded guilty on Tuesday to conspiracy to commit money laundering in connection with a $73 million cryptocurrency scam.
The U.S. Department of Justice (DOJ) stated that Li and his co-conspirators operated an elaborate “pig butchering” scheme, laundering at least $73.6 million in victim funds through shell companies and international bank accounts.
Li Carried Out Scheme From Outside U.S.
According to the DOJ, Li directed his associates to open U.S. bank accounts under the guise of shell companies and facilitated the conversion of stolen funds into the stablecoin Tether (USDT).
These funds were then transferred to crypto wallets under the control of Li and his accomplices.
Although Li carried out the scheme from outside the United States, he was arrested at Atlanta’s Hartsfield-Jackson International Airport in April.
He was later transported to the Central District of California, where he faces up to 20 years in prison.
Sentencing is scheduled for March 3, 2025.
“Financial criminals and the money launderers who enable them wreak untold harm, ruining lives in the process,” said United States Attorney Martin Estrada for the Central District of California.
“Investors should be diligent and on guard against anyone offering quick riches via new, exotic investments. A healthy dose of skepticism could prevent financial ruin down the road.”
“Pig butchering” scams involve fraudsters building trust with victims to convince them to invest large sums before disappearing with the funds.
Regulators, including the Commodity Futures Trading Commission, have expressed growing concerns over these scams.
Back in May, the Canadian Anti-Fraud Centre (CAFC) also warned about a surge in crypto scams targeting Canadian citizens.
At the time, the anti-fraud call centre said there had been an increase in two specific types of cryptocurrency scams targeting Canadian citizens, including pig butchering or romance scams, and investment scams.
Crypto Romance Scams Become Prevalent
Crypto romance scams have also been plaguing US citizens, resulting in significant financial losses.
Just recently, Shreya Datta, a 37-year-old tech professional from Philadelphia, fell victim to a cryptocurrency romance scam that left her financially ruined with losses mounting to $450,000.
As reported, Erin West, Deputy District Attorney in Santa Clara, California, has revealed that she receives an average of 5-6 emails daily from individuals who have fallen prey to pig butchering.
“We are receiving 5-6 emails a day from people who are victims of pig butchering. The most recent victim lost $5 million dollars and that’s not even the biggest amount one victim has lost to this scam.”
Compounding the issue, the stolen funds are funneled overseas to transnational criminal organizations in Myanmar and Cambodia, using trafficked individuals as virtual slaves to carry out the pig butchering scams.
Disclaimer: Crypto is a high-risk asset class. This article is provided for informational purposes and does not constitute investment advice. You could lose all of your capital.
