California Man Jailed for Role in $36.9M Crypto Scam

Shengsheng He, a California resident, has been recently sentenced to more than four years in federal prison for a crypto scam. He was found guilty of helping launder nearly $37 million stolen from American investors. The case is part of a larger international crypto fraud network run out of Cambodia, according to the U.S. Department of Justice (DOJ). DOJ Traces $36.9M Crypto Scam to Cambodia According to the DOJ, the scam was organized from Cambodia, where fraudsters targeted Americans through text messages, social media, phone calls, and online dating platforms. Victims were promised high returns from what appeared to be safe crypto investments. Instead of investing, the group moved the money through shell companies, U.S. bank accounts, and crypto wallets. At least $36.9 million was transferred from U.S. accounts into an Axis Digital account at Deltec Bank in the Bahamas. From there, the funds were converted into the stablecoin USDT and sent to wallets controlled by individuals in Cambodia. The money was then distributed to scam leaders, many of whom operated from Sihanoukville, a city known as a hub for such fraudulent centers. Crypto Scam Lands Man 51-Month Sentence The 39-year-old man has been sentenced to 51 months in federal prison. In addition, he must repay $26.8 million to victims who lost their money in the scheme. This comes after he pleaded guilty in April to conspiracy to operate an unlicensed money transmitting business in the Central District of California. Investigators found out that he co-owned Axis Digital Limited, a Bahamas-based company that prosecutors said was central to moving stolen funds overseas. Through this setup, money from U.S. investors was diverted into accounts abroad and later converted into cryptocurrency. The DOJ confirmed that other culprits have also pleaded guilty in connection with the scheme . This includes Chinese nationals Daren Li and Lu Zhang, who oversaw a network of U.S.-based money launderers tied to the fraudulent operation. Wider Crackdown on International Fraud Acting Assistant Attorney General Matthew R. Galeotti of the DOJ’s Criminal Division said that foreign scam centers promoting fake digital asset investments have become a growing threat. He stressed that U.S. authorities remain determined to hold accountable those who steal from American investors , regardless of where they operate. Other operations are also underway to curb illicit activities around the globe. On August 22, Interpol’s Operation Serengeti 2.0 arrested 1,209 suspected cybercriminals across Africa and recovered $97.4 million. The crackdown also shut down over 11,000 malicious infrastructures linked to scams that targeted nearly 88,000 victims. The post California Man Jailed for Role in $36.9M Crypto Scam appeared first on TheCoinrise.com .