The Department of Justice has seized about $15 billion worth of bitcoin held in cryptocurrency wallets owned by a man who oversaw a massive "pig butchering" fraud operation based in Cambodia, prosecutors said Tuesday.
The seizure is the largest forfeiture action sought by the DOJ in history.
An indictment charging the alleged pig butcher, Chen Zhi, with wire fraud conspiracy and money laundering conspiracy was unsealed Tuesday in federal court in Brooklyn, New York.
Zhi, a 38-year-old Chinese-born emigre who is also known as "Vincent," remains at large, according to the U.S. Attorney's Office for the Eastern District of New York. Zhi faces up to 40 years in prison if convicted of the charges.
He was identified in court filings as the founder and chairman of Prince Holding Group, a multinational business conglomerate based in Cambodia, which prosecutors said grew "in secret .... into one of Asia's largest transnational criminal organizations." The Prince Group allegedly operates 10 scam compounds in Cambodia.
The Treasury Department, in parallel action on Tuesday, designated Prince Group as a transnational criminal organization and announced sanctions against the Zhi and more than 100 associated individuals and entities, for their roles in alleged illicit activity.
Chart of The Prince Group Transnational Criminal Organization
U.S. Treasury Department
Brooklyn U.S. Attorney Joseph Nocella said that Zhi "directed one of the largest investment fraud operations in history, fueling an illicit industry that is reaching epidemic proportions."
"Prince Group's investment scams have caused billions of dollars in losses and untold misery to victims around the world, including here in New York, on the backs of individuals who have been trafficked and forced to work against their will," Nocella said.
The Prince Group, which operates businesses in more than 30 countries, ran "forced-labor scam compounds across Cambodia," the U.S. Attorney's Office said in a press release.
The documents detailed the completion of two particular facilities staffed with 1,250 mobile phones that controlled 76,000 accounts on a popular social media platform.
Source: US Eastern District of New York
"Individuals held against their will in the compounds engaged in cryptocurrency investment fraud schemes, known as 'pig butchering' scams, that stole billions of dollars from victims in the United States and around the world," the release said.
The scams duped people contacted via social media and messaging applications online into transferring cryptocurrency into accounts controlled by the scheme with false promises that the crypto would be invested and produce profits, according to the office.
"In reality, the funds were stolen from the victims and laundered for the benefit of the perpetrators," the release said. "The scam perpetrators often built relationships with their victims over time, earning their trust before stealing their funds."
Prosecutors said that hundreds of people were trafficked and forced to work in the scam compounds, "often under the threat of violence."
Zhi and a network of top executives in the Prince Group are accused of using political influence in multiple countries to protect their criminal enterprise and paid bribes to public officials to avoid actions by law enforcement authorities targeting the scheme, according to prosecutors.