The US government has seized $14 billion (£10.5 billion) worth of bitcoin and charged the founder of the Cambodian Prince Group with a large-scale cryptocurrency fraud linked to forced labor camps.
A British and Cambodian citizen, Chen Zi was indicted in New York on Tuesday on charges of conspiracy to commit online fraud and money laundering.
Chen’s businesses have also been blacklisted by the US and UK in a joint operation. The UK government has also frozen the network’s assets, including 19 properties in London – one of which is worth almost £100 million ($133 million).
US prosecutors have described the move as one of the largest financial seizures in history, as well as the largest bitcoin seizure, involving some 127,271 bitcoins now held by the US government.
According to the US Department of Justice (DOJ), Chen is accused of being the mastermind behind a “large-scale cyber fraud empire” operating under his multinational company, Prince Group.
The Cambodian group’s website states that its businesses include real estate development, as well as financial and consumer services.
However, the DOJ accuses the group of being one of the largest transnational criminal organizations in Asia.
In addition, unwitting victims of the scam were contacted and convinced to transfer cryptocurrencies based on false promises that the funds would be invested and generate profits.
Prosecutors allege that the company, under Chen’s direction, built and operated at least 10 fraud complexes across Cambodia.
Several of his accomplices are accused of collecting millions of mobile phone numbers and setting up “phone farms” to run the fraud syndicate through call centers.
According to US Assistant Attorney General for National Security John A. Eisenberg, the Prince Group has been described as a “criminal enterprise based on human suffering.”
They are also accused of trafficking workers who are locked in prison-like complexes and forced to carry out online fraud, targeting thousands of victims worldwide.
Chen and his associates are accused of using the proceeds of their crimes to finance a lavish lifestyle, including luxury travel and entertainment.
If convicted, Chen faces a maximum sentence of 40 years in prison.
