Two individuals accused of orchestrating a money laundering operation have been arrested by United States authorities. The operation involved channeling more than $73 million through American financial institutions and converting the funds into Tether’s USDT token.
On Friday, May 17, the U.S. Justice Department revealed that Daren Li was apprehended at Atlanta’s airport in Georgia on April 12, while Yicheng Zhang was arrested in Los Angeles on Thursday, May 16. An indictment detailing their alleged roles in the scheme was made public in a California court on May 16.
Li, Zhang, and their accomplices allegedly operated an international criminal network that laundered millions of dollars through “pig butchering” cryptocurrency scams. In these scams, fraudsters gain the trust of victims, convince them to invest large sums, and then disappear with the funds.
The defendants allegedly instructed their co-conspirators to open U.S. bank accounts under the names of shell companies. Through these accounts, the scammers persuaded victims to transfer millions of dollars, which were then used for money laundering purposes.
According to the DOJ, the illicit funds were subsequently dispersed across various domestic and international bank accounts. The DOJ stated that Li and Zhang have been charged with conspiracy to launder money and six counts of international money laundering. If convicted, they could face a maximum sentence of 20 years imprisonment for each count, potentially totaling 140 years behind bars.
Deputy Attorney General Lisa Monaco acknowledged the challenges posed by cryptocurrency fraud but affirmed the commitment to hold those responsible accountable. “Pig butchering” scams have become highly profitable for online criminals, with the DOJ seizing $9 million from a similar scheme in November 2023, targeting over 70 U.S. citizens. The increasing frequency and severity of these scams have raised concerns among lawmakers and regulators in recent months.
Regulators have intensified their efforts to combat crypto scams and related incidents in the market. This is evident in the proposed regulations and industry guidelines implemented by authorities. While these efforts are praised for protecting investors and safeguarding digital assets, some regulations could hinder the development of the sector.
U.S. enforcement agencies are ramping up their efforts to tackle crypto-related crime, signaling a growing crackdown on illicit activities in the cryptocurrency space.