The US government has moved to seize 127,271 bitcoins worth about $14.2 billion, which investigators say were generated by a cross-border “pig butchering” scam run by Chinese national Chen Zhi.

Once completed, Bitcoin should be added to the U.S. Strategic Bitcoin Reserve under the terms of President Trump’s executive order issued earlier this year. But a lack of formal policy amid a government shutdown and ratification time looming could disrupt plans.

The presidential order states:

“The Strategic Bitcoin Reserve operates with Bitcoins owned by the Treasury that have been confiscated as part of criminal or civil asset forfeiture proceedings.”

A legal filing filed on October 14 outlines a wide-ranging criminal enterprise that blends cryptocurrency investment fraud, human trafficking, and political corruption.

crypto fraud

According to court filings, Ji ran Prince Group, a central figure in Cambodia’s underground digital economy.

この組織は、人身売買労働者の拘留場所を兼ねた詐欺施設のネットワークを運営していた。 Thousands of migrants lured by fake job ads have reportedly been forced to operate fraudulent cryptocurrency investment schemes under threat of violence.

Under Mr. Chen’s direction, at least 10 major complexes have been established, including Jinbei Hotel and Casino, Golden Fortune Science and Technology Park, Mango Park and related facilities.

According to court records, Chen personally kept a ledger detailing the operations of each site and quoted the Chinese word “shazhu” (pig slaughter).これは、被害者を騙す前に感情的に操作する長期詐欺を指す用語だ。

The U.S. government alleges that Chen and his top executives used bribes and political influence to evade prosecution and even received advance warning of a planned raid by law enforcement.

By exploiting these connections, the group controlled billions of dollars in illicit cryptocurrency flows and established itself within Cambodia’s broader shadow economy.

Hoione’s sanctions

In addition to moving to confiscate the illegal funds, U.S. authorities, in conjunction with the UK Foreign, Commonwealth and Development Office (FCDO), also imposed sanctions on Mr. Jen and his associated entities.

According to a press release, OFAC has sanctioned 146 individuals and entities associated with the Prince Group Transnational Criminal Organization (TCO), a Cambodia-based syndicate led by Chen Zhi, for conducting hundreds of online investment scams targeting Americans and nationals of allied countries.

FinCEN also invoked Section 311 of the Patriot Act to formally isolate Cambodia’s Huione Group from the U.S. financial system, identifying it as a major conduit for laundering the proceeds of cryptocurrency fraud and related cybercrime.

U.S. officials said Mr. Fuionne’s network helped conceal billions of dollars in funds stolen from investors around the world.