The U.S. Department of Justice says it seized a record number of bitcoins in an action against a scamming network led by British-Cambodian national Chen Zhi.
Prosecutors say Chen and his associates enticed people to transfer cryptocurrency by promising to invest the funds and generate returns. According to the DOJ, little of that money reached investors; instead it was used for luxury purchases including watches, artwork, airplanes and travel.
How prosecutors say the scheme worked
The group operated under the company Prince Group, whose business activities included financial services and project development, according to documents seen by the BBC.
Those documents say the group ran multiple call centres where forced labour took place and employees were required to call as many people as possible. The company obtained millions of phone numbers and maintained about 76,000 social media accounts to solicit payments.
Staff were given materials explaining how to build a relationship of trust with targets. They “were also advised not to use photos of overly attractive women in their online activities, as this would arouse suspicion,” the documents say.
Chen is suspected of fraud and money laundering. If found guilty of all charges, he could face up to 40 years in prison.
