Two Foreign Nationals Arrested for Laundering $73M from Crypto Scams Through Shell Companies
On Friday, May 17, 2024, the US Department of Justice announced the arrests of two foreign nationals involved in a major international money laundering scheme.
Daren Li, a 41-year-old dual citizen of China and St. Kitts and Nevis, and Yicheng Zhang, a 38-year-old Chinese national living in California, were charged with conspiracy to commit money laundering and international money laundering for their roles leading a criminal network that laundered over $73 million tied to cryptocurrency investment scams.
According to officials, Li and Zhang managed a sophisticated international money laundering syndicate that helped process profits from fraudsters perpetrating “pig butchering” scams. These scams involve deceiving victims into transferring millions of dollars worth of cryptocurrency to accounts controlled by criminal groups.
Once victims sent funds to shell company accounts in the United States opened by the network, lower-level co-conspirators directed the money overseas and converted it to the cryptocurrency USDT (Tether) to obscure the funds’ source and flow. A cryptocurrency wallet involved in the scheme received more than $341 million in virtual assets.
The indictment details extensive coordination between Li, Zhang, and other conspirators to facilitate the laundering process. Money was moved from U.S. accounts to banks in The Bahamas and then converted to cryptocurrency and deposited in digital wallets, including one belonging to Li. Communications revealed planning money laundering operations, allocating shell companies, discussing victim information, and monitoring the process.
If convicted, Li and Zhang each face a maximum of 20 years in prison on each count relating to conspiracy and international money laundering. The arrests were the result of ongoing investigations by agencies including the US Secret Service, Homeland Security Investigations, Immigration and Customs Enforcement, and others.
