US and UK jointly seize $15 billion in Bitcoin: How did the Southeast Asian pig-butchering scam empire collapse?

Author: Wired

Translation: Luffy, Foresight News

Original Title: $15 Billion in Bitcoin Seized: The Collapse Behind Southeast Asia's "Pig Butchering" Empire

Note from Rhythm: On October 14, news broke from the U.S. District Court for the Eastern District of New York (EDNY) that the U.S. government is seeking to confiscate 127,000 bitcoins seized in an operation against Cambodia's Prince Group, valued at over $14 billion at current prices. If the confiscation is successfully executed, the U.S. government will become the largest single entity holding bitcoin. Below is a detailed analysis of the case:

Over the past five years, criminals behind global "pig butchering" scams have stolen tens of billions of dollars from around the world. Now, law enforcement agencies have launched one of the largest operations to date against this vast scam industry, targeting operators of modern slavery scam compounds across Southeast Asia. In this region, hundreds of thousands of human trafficking victims have been forced to carry out scams for criminal syndicates.

This Tuesday, U.S. and U.K. officials coordinated to crack down on a major criminal organization in Cambodia and its leader, who allegedly runs several notorious scam centers in the country. The U.S. Treasury Department's Office of Foreign Assets Control (OFAC) announced financial sanctions against 146 targets associated with the newly designated transnational criminal organization Prince Group, covering individuals and shell companies linked to the criminal empire. As part of a broader operation involving the FBI, the U.S. Department of Justice (DOJ) also seized nearly 130,000 bitcoins, worth about $15 billion at the time of the announcement—marking the largest cryptocurrency seizure in U.S. history.

OFAC noted that the Prince Group criminal entity consists of the Cambodian-based Prince Holding Group, its chairman and CEO Chen Zhi, and their associates and business partners. The company publicly claims to be one of Cambodia's largest conglomerates, with businesses spanning real estate development and financial services. However, the DOJ alleges that Chen Zhi and other executives secretly transformed Prince Group into one of Asia's largest transnational criminal organizations, operating at least 10 scam compounds within Cambodia.

"As alleged, the defendants controlled one of the largest investment fraud networks in history, fueling an illegal industry that has reached epidemic proportions," said U.S. Attorney Joseph Nocella Jr. for the Eastern District of New York in a statement. "Prince Group's investment scams have caused billions of dollars in losses to victims worldwide and incalculable suffering." The DOJ revealed that Chen Zhi has not yet been apprehended and remains at large.

U.K. Home Secretary Yvette Cooper stated: "The masterminds behind these horrific scam compounds destroy the lives of vulnerable people while hiding their illicit gains by purchasing property in London." The U.K. has also imposed financial sanctions on Chen Zhi, Prince Group, and other related entities, freezing London commercial assets and properties allegedly linked to Chen Zhi, including a luxury mansion in North London valued at £12 million (about $16 million) and an office building in the City of London worth £100 million (about $133 million).

Emails sent by reporters to the media contact address listed on the "Prince Holding Group" official website were immediately returned.

"Today's coordinated action is the most significant blow yet to Southeast Asia's cybercrime syndicates," said John Wojcik, a senior threat researcher at cybersecurity firm Infoblox specializing in Asian affairs. He previously tracked scam compounds and cybercrime in Southeast Asia for the United Nations Office on Drugs and Crime (UNODC). Wojcik believes the group "is far from an ordinary criminal gang—it is one of the region's largest cybercrime and money laundering entities, as well as a leader in criminal fintech and infrastructure."

However, there is still an unresolved twist in the case. Cryptocurrency tracking firm Elliptic pointed out in a blog post on Tuesday that the bitcoins seized by U.S. law enforcement actually appear to be the same funds stolen in 2020 from a Chinese crypto mining company called Lubian. The current indictment describes Lubian as part of Chen Zhi's money laundering network, possibly as part of a criminal scheme to transfer scam proceeds into crypto mining hardware, generating "clean new coins" with no criminal record.

It remains far from clear who actually stole these funds in 2020, or whether a theft even occurred. "It's possible that Chen Zhi fabricated the theft as part of a money laundering scheme to obscure the flow of funds," said Tom Robinson, co-founder of Elliptic. "The second possibility is that the theft did occur, and the perpetrator may have been the U.S. government, but more likely it was someone else." Robinson said U.S. law enforcement may have subsequently tracked down the thief and somehow seized the funds from them.

Regardless of the crypto mining money laundering and mysterious theft, the indictment accuses Chen Zhi of being a core participant in the Chinese-language "pig butchering" scam ecosystem. Over the past decade, organized crime groups active in Southeast Asia have operated dozens of scam compounds in Myanmar, Laos, and Cambodia. These compounds are mostly controlled by Chinese criminal syndicates, who lure people from over 60 countries worldwide with fake job ads. Upon arrival, victims often have their passports confiscated and are forced to run various online scams targeting people globally; those who refuse may be beaten or abused. In addition to human trafficking and fraud, these scam compounds are often linked to money laundering and online gambling.

The DOJ indictment against Chen Zhi and seven unnamed co-conspirators alleges that Prince Group operates over 100 companies in 30 countries, listing several allegedly affiliated subsidiaries. The indictment also mentions that some local organizations, including a network in Brooklyn, New York, have served Prince Group. The charges state that since 2015, Chen Zhi and company executives have established and operated scam compounds across Cambodia, using their political influence in multiple countries to protect their criminal empire.

The indictment states: "Chen Zhi directly participated in the management of scam compounds and kept records for each compound, including documents tracking scam profits, which explicitly mention the term 'pig butchering'," and also allegedly maintained "ledgers of bribes to public officials." One document reportedly held by Chen Zhi shows that two scam centers were equipped with 1,250 mobile phones used to control 76,000 social media accounts. The indictment also accuses Chen Zhi of possessing evidence of Prince Group's use of violence against trafficked victims in scam compounds, including images showing people bleeding and being beaten.

The 127,271 bitcoins seized in this operation were valued at over $15 billion at the time of confiscation. This is the largest asset seizure in the history of the U.S. Department of Justice, setting a record for both cryptocurrency and any other form of funds. The previous U.S. law enforcement record was set in 2022, when 95,000 bitcoins (worth $3.6 billion) were seized, and the Manhattan couple involved later admitted to stealing funds from the Bitfinex exchange; earlier, in 2020, authorities seized $1 billion in bitcoin allegedly stolen by an anonymous hacker from the Silk Road darknet drug market. In addition, in June this year, U.K. police seized 61,000 bitcoins (worth $6.7 billion) from a Chinese woman suspected of investment fraud, a sum larger than the previous U.S. record but still less than half of the amount seized in the Prince Group case.

"It should be noted that the extraordinary significance of this seizure lies not only in its scale, but also in its symbolism," said Ari Redbord, Global Head of Policy at crypto tracking firm TRM Labs, while noting that "this is still only a small fraction of the illicit profits from scam compounds." He added: "These are not isolated scams, but factory-level operations relying on forced labor, amplified by the speed and scale of cryptocurrency, and interconnected through complex money laundering infrastructure spanning Cambodia, Myanmar, Laos, China, and other regions."

Redbord believes this large-scale operation strikes at the operational and financial core of the scam compound ecosystem. In recent years, researchers tracking Southeast Asian scam compounds have found that these sites have rapidly expanded in scale and used illicit proceeds to invest in increasingly sophisticated scam activities. Over the past two years, scam compounds have also begun to emerge outside Southeast Asia, with related sites found in the Middle East, Eastern Europe, Latin America, and West Africa.

"By targeting the financial structures—shell companies, banks, exchanges, and real estate—that move and hide illicit funds, the U.S. and U.K. are dismantling the economic engines that sustain these crimes," Redbord said. "This is what 21st-century counter-threat finance action should look like—coordinated, data-driven, and global."