US Launches Largest Forfeiture Operation to Sanction Chinese Crime Kingpin, Exposes Major Scam in Cambodia

On the 14th, the US government charged Chen Zhi (age 38), founder and chairman of Cambodia’s Prince Holding Group, with suspected telecom fraud and money laundering.

Meanwhile, the US Treasury Department also simultaneously designated Prince Group as a transnational criminal organization, blacklisting 146 individuals and entities linked to the group, including Chen Zhi himself and his executives, as well as dozens of shell and holding companies registered in Cambodia, Hong Kong, Singapore, the British Virgin Islands, and the UAE.

The US Department of Justice released a statement saying that Chen Zhi, who is currently at large, is suspected of telecom fraud and money laundering. They have requested court approval to seize Chen Zhi's scam proceeds, totaling around 127,271 bitcoins (currently valued at about $15 billion or roughly MYR 63.384 billion).

This is the largest forfeiture operation in US Department of Justice history. The funds were originally held in a cryptocurrency wallet for which Chen Zhi possessed the private key, and are now under US government control. If convicted, Chen Zhi faces up to 40 years in prison.

It is understood that Chen Zhi, originally a Chinese citizen, obtained Cambodian citizenship in 2014 and also holds UK nationality.

Chen Zhi directed the group to establish scam compounds across Cambodia, where detainees were forced to carry out "pig-butchering" cryptocurrency investment fraud, stealing billions of dollars from victims in the US and elsewhere.

According to the indictment and forfeiture order, since around 2015, Chen Zhi has acted as founder and chairman of Prince Group, running dozens of business entities in more than 30 countries, with purported core businesses in real estate development, finance, and consumer services.

Chen Zhi and other Prince Group executives secretly developed the group into one of Asia's largest transnational criminal organizations. Under Chen’s orders, Prince Group operated scam operations throughout Cambodia, conducting cryptocurrency investment fraud that generated huge profits.

The US Department of Justice noted that to perpetrate these schemes, criminals contacted unsuspecting victims via SMS or social media apps, luring them into transferring cryptocurrency to designated accounts under the claim of profitable investments. In reality, the funds were laundered and used for personal gain. Scammers often established long-term relationships with victims to build trust, then stole their funds.

Prince Group trafficked hundreds of laborers, forcing them to conduct scams at compounds in Cambodia, often under threat of violence. These compounds feature large dormitories surrounded by high walls and barbed wire. Chen Zhi directly participated in running the compounds, retaining records on each, including profit ledgers and documentation of the types of scams assigned to each room.

Chen Zhi also maintained files describing "phone farms" in the compounds—automated call centers using thousands of phones and millions of numbers to facilitate various scam schemes. Chen Zhi personally engaged in violence against compound staff, and kept photo and video evidence of the Prince Group’s violent acts, including beatings and other forms of torture.

The US Department of Justice stated that the tight-knit network of Chen Zhi and other Prince Group executives leveraged political influence across multiple countries to protect their criminal activities, bribing government officials to avoid law enforcement scrutiny. They then washed their fraudulent proceeds via professional money laundering and a network of ostensibly legitimate businesses, such as online gambling and cryptocurrency mining.

Under Chen Zhi’s direction, Prince Group accomplices used sophisticated cryptocurrency laundering techniques to obscure the sources of the group’s fraudulent profits, including so-called “spraying” and “funneling” methods—in which large batches of cryptocurrency are repeatedly dispersed across dozens of wallets and then reconsolidated into a few wallets, thereby hiding the money trail.

Chen Zhi and his accomplices used some illicit proceeds for luxury travel and entertainment, purchasing watches, yachts, private jets, vacation homes, high-end collectibles, and rare artwork, including a Picasso painting bought through a New York City auction house.