A Chinese national was arraigned in California after being extradited from the Netherlands for his alleged involvement in a cryptocurrency investment scam that stole nearly $37 million from 174 victims in the United States.
In these fraud schemes (also known as pig butchering or romance baiting scams), cybercriminals contact targets through social media, dating sites, and messaging apps, build trust, and lure them into fake investment schemes, stealing their money instead of investing the funds as promised.
Prosecutors said that, together with accomplices in the United States and Cambodia, 44-year-old Zhen Zhao tricked victims into transferring large sums of money to attacker-controlled accounts, claiming that the funds would be invested in digital assets.
The criminal ring Zhao was allegedly part of reached out to targets across the United States via unsolicited text messages, social media, phone calls, and even online dating services to gain their trust, promoting the fraudulent digital asset investments and saying that the victims' funds' value increased, when, in fact, their money was stolen.
"The co-conspirators created fake websites that resembled real cryptocurrency trading platforms and convinced victims to send funds through the fake websites for investments," the Department of Justice said.
"Zhao and other co-conspirators arranged for Deltec Bank to convert victim funds to the stablecoin Tether (USDT) and to transfer the converted funds to a digital asset wallet controlled in Cambodia. From there, co-conspirators in Cambodia transferred the USDT to the leaders of scam centers throughout the region."
Victims transferred over $36.9 million, "invested" in the scheme, from U.S. bank accounts to an account at Deltec Bank in the Bahamas, which was opened under the name Axis Digital Limited.
Zhao was charged in August 2025 with conspiracy to commit money laundering and faces a maximum sentence of 20 years in prison if found guilty.
Eight of his accomplices, part of the same international crime ring, have already pleaded guilty, and two of them have been sentenced to 51 months and 46 months in prison.
According to the FBI's 2025 Internet Crime Report, investment scammers stole over $8.6 billion last year (according to 72,984 complaints), up from $6.5 billion in 2024.
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