Federal prosecutors have seized $15 billion from the alleged kingpin of an operation that used imprisoned laborers to trick unsuspecting people into making investments in phony funds, often after spending months faking romantic relationships with the victims.
Such “pig butchering” scams have operated for years. They typically work when members of the operation initiate conversations with people on social media and then spend months messaging them. Often, the scammers pose as attractive individuals who feign romantic interest for the victim.
Eventually, conversations turn to phony investment funds with the end goal of convincing the victim to transfer large amounts of bitcoin. In many cases, the scammers are trafficked and held against their will in compounds surrounded by fences and barbed wire.
On Tuesday, federal prosecutors unsealed an indictment against Chen Zhi, the founder and chairman of a multinational business conglomerate based in Cambodia. It alleged that Zhi led such a forced-labor scam operation, which, with the help of unnamed co-conspirators, netted billions of dollars from victims.
“The defendant CHEN ZHI and his co-conspirators designed the compounds to maximize profits and personally ensured that they had the necessary infrastructure to reach as many victims as possible,” prosecutors wrote in the court document, filed in US District Court for the Eastern District of New York. The indictment continued:
For example, in or about 2018, Co-Conspirator-1 was involved in procuring millions of mobile telephone numbers and account passwords from an illicit online marketplace. In or about 2019, Co-Conspirator-3 helped oversee construction of the Golden Fortune compound. CHEN himself maintained documents describing and depicting “phone farms,” automated call centers used to facilitate cryptocurrency investment fraud and other cybercrimes, including the below image:
Credit:
Justice Department
Prosecutors said Zhi is the founder and chairman of Prince Group, a Cambodian corporate conglomerate that ostensibly operated dozens of legitimate business entities in more than 30 countries. In secret, however, Zhi and top executives built Prince Group into one of Asia’s largest transnational criminal organizations. Zhi’s whereabouts are unknown.
