Chinese national admits to laundering crypto scam loot via US companies
A Chinese national has pleaded guilty to laundering $73 million linked to crypto scams through multiple shell companies in the United States.
According to a Nov. 12 announcement from the Department of Justice, the accused Daren Li, a dual citizen of China and St. Kitts and Nevis, has pleaded guilty to conspiracy to commit money laundering, admitting to his involvement in laundering $73 million amassed from investment scams, including pig butchering crypto schemes.
Between August 2021 and April 2024, Li and his accomplice “knowingly” conducted transactions using funds that “represented proceeds of wire fraud,” a plea agreement filed with the California federal court added.
Li admitted to instructing his accomplices to open multiple U.S. bank accounts under fake shell companies. Funds from victims were transferred into these accounts, with Li and his associate, Yicheng Zhang, another Chinese national residing in California, overseeing all transactions.
Once the funds were in place, Li moved the money into accounts he controlled. He then converted the funds into cryptocurrencies like Tether, which were distributed across various wallets managed by him and his accomplices.
Out of the $73.6 million that the accused admitted to laundering, $59.8 million was funneled through U.S. shell companies, while the remaining amount was directly deposited into bank accounts associated with the scheme.
Li and Zhang were initially charged by the DOJ in May. At the time, the regulator found several related international accounts were created at Deltec Bank in The Bahamas. Meanwhile, a crypto wallet linked to the case was found to have received over $341 million in cryptocurrencies.
Both Li and Zhang were arrested in the United States, but only Li has pleaded guilty and is currently awaiting sentencing set for March 3, 2025.
Li faces a maximum sentence of 20 years in prison, three years of supervised release, and a fine of either $500,000 or “twice the gross gain or gross loss resulting from the offense,” the plead agreement noted. Further, He may also be ordered to pay full restitution to victims.
Pig butchering scams have pulled in over $75 billion from victims all across the globe between January 2020 and February 2024. These scams typically start with the swindlers building trust with their targets and eventually convincing them to invest big in dubious opportunities often involving cryptocurrencies.
An FBI report found that individuals over 60 appear to be the most vulnerable demographic, reporting the highest number of complaints, with collective losses exceeding $1.6 billion in 2023.
.
