Bitcoin price $14bn seized in US-UK crackdown on alleged scammers

The US authorities has seized greater than $14bn (£10.5bn) in bitcoin and charged the founding father of a Cambodian enterprise empire, Prince Group, with allegedly masterminding an enormous cryptocurrency rip-off.

UK and Cambodian nationwide Chen Zhi was charged on Tuesday in New York for allegedly partaking in a wire-fraud conspiracy and operating a cash laundering scheme.

Mr Chen’s companies have been additionally sanctioned by the US and the UK as a part of a joint operation. The UK authorities says it has frozen property owned by his community, together with 19 properties in London – one among which is price practically £100m ($133m).

The BBC has contacted the Prince Group for remark.

US prosecutors say it’s one the most important monetary takedowns in historical past and the biggest ever seizure of bitcoin, with roughly 127,271 bitcoin being held by US authorities.

Mr Chen, who stays at giant, is accused of being the mastermind behind a “sprawling cyber-fraud empire” working underneath his multi-national firm, the Prince Group, mentioned the US Division of Justice (DOJ).

The Cambodia-based group’s web site says its companies embody property improvement, and monetary and shopper companies. However the DOJ alleges that it runs one among Asia’s largest transnational prison organisations.

Unwitting victims have been contacted on-line and satisfied to switch cryptocurrency primarily based on false guarantees that the funds can be invested and generate income, the DOJ mentioned.

Prosecutors alleged that the corporate, underneath Mr Chen’s route, constructed and operated not less than ten rip-off compounds all through Cambodia, in response to court docket paperwork seen by the BBC.

Mr Chen was accused of managing the compounds that have been specifically designed to achieve as many victims as potential, mentioned prosecutors.

His accomplices allegedly procured hundreds of thousands of cell phone numbers and arrange “telephone farms” to conduct name centre scams, in response to the court docket paperwork, dated 8 October.

Two of those services had 1,250 cellphones that managed round 76,000 social media accounts for scams, the paperwork mentioned.

Prosecutors mentioned Prince Group paperwork included tips about constructing rapport with victims, advising staff to not use profile images of girls who have been “too stunning” in order that the accounts would look extra real.

Assistant Lawyer Common for Nationwide Safety John A Eisenberg described the Prince Group as a “prison enterprise constructed on human struggling”.

It additionally trafficked staff, who have been confined in prison-like compounds and compelled to hold out scams on-line, focusing on hundreds of victims worldwide, he mentioned.

Mr Chen and his accomplices allegedly used the prison proceeds for luxurious journey and leisure, mentioned the DOJ.

In addition they made “extravagant” purchases like watches, personal jets and uncommon paintings, together with a Picasso portray purchases from a New York Metropolis public sale home, the division mentioned.

If convicted, Mr Chen faces a most penalty of 40 years in jail.

In Britain, Mr Chen and his accomplices allegedly included companies within the British Virgin Islands and invested in UK property. His community’s property embody a £100m workplace constructing on central London, a £12m mansion in North London and seventeen flats within the metropolis, mentioned the UK overseas workplace on Tuesday.

Being sanctioned, as a part of a joint operation with US authorities, means he’s now locked out of the UK’s monetary system.

The Prince Group has additionally been sanctioned within the US and labelled as a prison organisation.

They have been “ruining the lives of weak folks and shopping for up London houses to retailer their cash”, UK Overseas Secretary Yvette Cooper mentioned.

Cooper mentioned: “Along with our US allies, we’re taking decisive motion to fight the rising transnational menace posed by this community – upholding human rights, defending British nationals and maintaining soiled cash off our streets.”

The overseas workplace mentioned Mr Chen and the Prince Group constructed casinos and compounds used as rip-off centres and laundered the proceeds.

4 companies linked to the alleged scams – The Prince Group, Jin Bei Group, Golden Fortune Resorts World and Byex Change – have additionally been sanctioned, mentioned the overseas workplace.

Two rip-off centres allegedly run by Jin Bei Group and Golden Fortune Resorts have been named earlier this 12 months in an Amnesty Worldwide report on using pressured labour and torture in Cambodian rip-off centres.

Folks working in rip-off centres are sometimes overseas nationals lured by the promise of a legit job, after which pressured to hold out scams underneath menace of torture, the overseas workplace mentioned.

These scammers function on an “industrial scale”, together with within the UK, utilizing methods like faux romantic relationships to lure victims into being scammed, mentioned the overseas workplace.

Fraud Minister Lord Hanson mentioned: “Fraudsters prey on probably the most weak by stealing life financial savings, ruining belief, and devastating lives. We is not going to tolerate this.”