Chinese Citizen Admits to $73.6M Crypto Scam as “Pig Butchering” Fraud Rises

Li operated this scheme mostly outside of the US, using a network of accomplices to open US bank accounts under the guise of shell companies. Once the funds were transferred, Li’s team would convert them to the stablecoin Tether (USDT) and send them to crypto wallets under their control.

🚨 Chinese national pleads guilty to laundering $73 million in crypto scams through US shell companies. Accused admitted to using pig butchering schemes to amass funds. 💸 Beware of crypto fraud impacting victims globally! #CryptoScam #MoneyLaundering 🐷🔒

— Ultra | MSU🍄 Player | Crypto Updater (@pure_ai_chain_) November 13, 2024

Although Li orchestrated the scheme from abroad, he was caught at Atlanta’s Hartsfield-Jackson International Airport in April and is being held in California. He faces up to 20 years in prison, with sentencing on March 3, 2025.

What is “Pig Butchering”?

“Pig butchering” scams are designed to gain your trust over time, to get you to invest large sums of money and then disappear with it. Often associated with cryptocurrency, these scams typically involve romantic or close personal relationships formed online. The scammers present themselves as trusted friends, and then convince you to invest large sums in fake schemes.

These scams are becoming a growing concern for global regulators. In May, Canada’s Anti-Fraud Centre reported a surge in these types of scams targeting Canadian citizens. US authorities are also sounding the alarm. “Financial criminals and the money launderers who enable them cause immeasurable harm,” said Martin Estrada, US Attorney for the Central District of California. “Be skeptical of any high return promises, especially with unconventional or exotic investments.”

The Rise of Romance-Based Crypto Scams

Romance scams involving cryptocurrency are becoming more common, affecting thousands in the US and resulting in big losses. Recently, Philadelphia tech professional Shreya Datta lost $450,000 in one such scam. Erin West, Deputy District Attorney in Santa Clara, California says she gets 5-6 emails a day from victims. “The latest victim lost $5 million,” West said.

https://twitter.com/CoinnessGL/status/1856652162274631841

And to make things worse, much of the stolen money is sent to transnational criminal organizations in countries like Myanmar and Cambodia. Reports show that these groups use trafficked individuals as forced labour to run these scams.

Key Takeaways:

• $73.6M Scheme: Li’s “pig butchering” scam laundered millions through shell companies.

• Rising Threat: Crypto and romance-based scams continue to grow in the U.S. and Canada.

• Transnational Reach: Stolen funds often support overseas criminal networks.

As these scams rise, authorities urge vigilance. Investors are encouraged to verify any investment promises independently to avoid becoming the next victim.