LOS ANGELES
An indictment was unsealed Thursday in federal court charging Daren Li and Yicheng Zhang, both Chinese nationals, with leading roles in a cryptocurrency investment scam laundering scheme.
Li, a dual citizen of China and St. Kitts and Nevis, was apprehended at Hartsfield-Jackson Atlanta International Airport on April 12 and transported to California. Zhang, a resident of Temple City, was arraigned in Los Angeles today.
The charges include conspiracy to commit money laundering and six counts of international money laundering, with each count carrying a potential maximum sentence of 20 years in prison.
Zhang pleaded not guilty and remains in federal custody pending a detention hearing on May 21. Li is detained without bond and scheduled for arraignment on May 20.
U.S. Attorney Martin Estrada emphasized the dangers of sophisticated financial scams like these, urging public vigilance against financial fraud, particularly “pig butchering” schemes.
Court documents reveal Li, Zhang, and others allegedly managed an international network that laundered money from these scams through U.S. bank accounts linked to shell companies.
This network obscured the origin of over $73 million, routing it through various banks and converting it to the cryptocurrency Tether.
Nicole M. Argentieri, principal deputy assistant attorney general, stated that Li and Zhang were instrumental in laundering millions from victims of these scams.
The U.S. Secret Service’s Brian Lambert highlighted the ongoing threat such schemes pose to U.S. financial systems, with the Secret Service recovering over $1.1 billion in financial fraud last year.
With assistance from numerous federal agencies, the U.S. Secret Service’s Global Investigative Operations Center is looking into the case.
The National Cryptocurrency Enforcement Team of the Justice Department and other federal attorneys are pursuing this case.
Victims of cryptocurrency investment fraud are encouraged to report incidents to www.IC3.gov, referencing “Pig Butchering PSA” and including all relevant information for the investigation.