Feds Seize $15 Billion in Crypto from Forced Labor ‘Pig Butchering’ Scheme

Federal authorities have seized an unprecedented $15 billion in cryptocurrency linked to a fraudulent investment scheme called “pig butchering.” This action represents the largest forfeiture in U.S. history.

Details of the Pig Butchering Scheme

The Justice Department revealed that the scheme has ties to forced labor camps in Cambodia. Charges have been filed against Chen Zhi, a Chinese émigré and leader of the Prince Group, a major conglomerate in Cambodia. He faces accusations of money laundering conspiracy and wire fraud conspiracy.

Ongoing Investigations and Actions

Chen remains at large as investigators continue to probe the extensive operations of the Prince Group. In a related move, the Treasury Department sanctioned numerous affiliates, designating them as criminal organizations. This crackdown highlights a broader trend, as “pig butchering” scams have surged, defrauding Americans of significant sums.

The Scale of Operation

• 127,271 bitcoins were seized, valued at approximately $15 billion.
• The Prince Group allegedly operated at least 10 forced labor camps since 2015.
• In 2018, the operation generated over $30 million daily from fraudulent activities.

Modus Operandi

Chen and his associates allegedly used forced labor camps as automated call centers, known as “phone farms.” These operations employed up to 1,250 mobile phones managing around 76,000 social media accounts. Victims were targeted on messaging apps, often initiated through seemingly accidental contacts.

Instructions were provided to workers on how to engage potential victims by creating relatable profiles. Scammers built rapport over weeks before inviting individuals to invest money, claiming counterfeit profits to persuade further investments. Once victims were tricked into transferring funds, all contact would abruptly cease.

Violence and Coercion

Reports indicate that physical violence was employed at the camps to maintain control over the laborers. Additionally, the indictment revealed that Chen and his co-conspirators systematically bribed officials in various countries to avoid law enforcement scrutiny, maintaining meticulous records of these transactions.

Impact and Community Response

The recent seizure far surpasses a previous record of $225 million connected to other crypto scams announced in June. Law enforcement agencies are intensifying efforts to educate the public about the dangers of crypto-investment scams. Many schemes are reportedly rooted in organized networks operating throughout Southeast Asia.

FBI officials emphasize the importance of caution when engaging with potential investment opportunities online. Victims are urged to report suspected scams to the FBI, as many individuals have suffered devastating financial losses due to these fraudulent operations.