How a California Man Laundered $37 Million in Crypto Fraud

A California man who laundered $37M in an international scam at Cambodian centers was sentenced to 51 months. Ordered to pay $26.8M in restitution.

A California man was convicted of more than four years of federal prison after laundering about 37 million in a worldwide digital resource scam. 

The Department of Justice announced Shengsheng He, 39, of La Puente, was sentenced to 51 months on account of his assistance in laundering money stolen by the use of scam operations located in Cambodia.

Additionally, he was found guilty of conspiring to run an illicit money transmission business, which led to his conviction.

He was once the co-owner of Axis Digital Limited in the Bahamas, which was a company to sent money to the victim.

Global Fraud Funnel Unravelled.

The scam lured victims with unsolicited messages on social media, telephones, text messages, and dating applications. 

The victims got deceived into thinking their investments in the digital assets were increasing, yet their money was draining away.

Court records indicate that more than $36.9 million of the U.S. victims was transferred through a single bank account at Axis Digital Bank in the Bahamas, which is known as the Deltec Bank. 

These were exchanged into a stablecoin called Tether (USDT) and laundered through digital wallets that were run by Cambodian conspirators.

In an obscure international operation, U.S. shell companies, foreign banking accounts, and digital wallets were used to launder stolen funds. 

Ultimately, spread the crypto proceeds among the leaders of Cambodian scam centers, including Sihanoukville.

Responsibility and Accomplices.

The court awarded a restitution of more than 26.8 million dollars to the victims against Shengsheng He. 

Eight co-conspirators have been found guilty such as Chinese and St. Kitts and Nevis nationals and Axis Digital co-founders.

Acting Assistant Attorney General Matthew Galeotti emphasized the emergence of foreign-based scam centers that exploit American investors by misleading them by investing in digital assets. 

The U.S. acting Attorney Bill Essayli cautioned the citizens to beware of unsolicited investment opportunities, in order to preserve their savings.

Not only was this an investigation that involved multiple agencies, including Homeland Security Investigations and the United States Marshals Service. It was also an indication of a comprehensive crackdown on fraud related to cryptocurrencies.