A man in California has been sentenced to 51 months (4 years) in federal prison for laundering $36.9 million in stolen cryptocurrency.
According to the U.S. Department of Justice, the money has been stolen from American investors through a Cambodia-based crypto investment scam.
Shengsheng He, of La Puente pleaded guilty in April to conspiracy to operate an unlicensed money transmitting business in the Central District of California.
The judge also ordered him to pay $26.8 million in restitution to victims.
A stolen crypto scam in Cambodia
As co-owner of Bahamas-based Axis Digital Limited, He helped funnel victims’ funds into overseas accounts.
The scam orchestrated from Cambodia, targeted U.S. investors through unsolicited text messages, social media, phone calls, and online dating platforms.
The scammers were even romantically involved with victims as a way of luring them promising high returns on crypto investments.
Instead, the funds were siphoned through shell companies, U.S. bank accounts, and cryptocurrency wallets controlled by the fraud network.
At least $36.9 million was transferred to an account at Deltec Bank in the Bahamas under Axis Digital’s name.
The money was then converted into USDT (a stablecoin tied to the U.S. dollar) and sent to wallets managed by individuals in Cambodia.
The funds were then distributed to scam center leaders, including operations in Sihanoukville.
Acting Assistant Attorney General Matthew R. Galeotti said foreign scammers have become a big threat to US Crypto investors.
Eight co-conspirators, including Chinese national Daren Li and Lu Zhang have also pleaded guilty in connection with the scheme.
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