US authorities bust $73 million in crypto scam, make two arrests

US authorities have arrested two individuals accused of masterminding a money laundering scheme. The plan involved hiding more than $73 million through US financial institutions and eventually converting the money into Tether USDT tokens.

The US Department of Justice announced on Friday, May 17 that Darren Li was arrested at the Atlanta airport in the US state of Georgia on April 12, and Yicheng Zhang was arrested on Thursday, May 16 in Los Angeles. The case against the couple has not been sealed. on May 16 in a California court, revealing their role in the scheme.

Li, Zhang and their accomplices allegedly ran an international criminal network that swindled millions from “pig farming” crypto scams, where fraudsters gain the trust of victims, convince them to invest heavily, and then make them disappear with the money.

The defendants directed co-conspirators to open US bank accounts in the name of shell companies. The fraudsters convinced victims to transfer millions of dollars to these US bank accounts, which they then used to launder illicit funds.

According to the DOJ report, the money was later dispersed into various domestic and foreign bank accounts. DOJ said:

“The fraud scheme involved transferring over $73 million through US financial institutions to bank accounts in the Bahamas and converting it into the virtual currency USDT or Tether. A cryptocurrency wallet that participated in the scheme received more than $341 million in virtual assets.

Li and Zhang were charged with conspiracy to commit money laundering and six counts of international money laundering. If convicted, they face a maximum of 20 years in prison for each charge, with a possible total of 140 years behind bars.

Related: Tether freezes $5.2M in USDT linked to phishing scams

Deputy Attorney General Lisa Monaco acknowledged the challenges posed by cryptocurrency fraud but reaffirmed her commitment to holding criminals accountable.

Pork scams have become lucrative for online criminals. In the year In November 2023, the DOJ seized $9 million from the scheme, which involved more than 70 US citizens. Due to its increasing frequency and severity, this type of fraud has raised alarm bells among lawmakers and regulators in recent months.

Regulators have stepped up efforts to crack down on crypto scams and related incidents in the market. This can be seen in the proposed regulations and industry guidelines proposed by the authorities. While efforts to protect investors and protect digital assets are lauded, some regulations may be a hindrance to the sector's growth.

Magazine: US law enforcement agencies are turning up the heat on crypto-related crimes.