Chen Zhi, founder and Chairman of Prince Holding Group, has been indicted on wire fraud and money laundering charges.

Zhi, originally from China, appears to be a primary link between Chinese organized crime groups and Cambodia.

To that end Zhi obtained Cambodian citizenship and ran a “multinational business conglomerate” tied to Cambodia’s notorious scam compounds.

“As alleged, the defendant was the mastermind behind a sprawling cyber-fraud empire operating under the Prince Group umbrella, a criminal enterprise built on human suffering.

Trafficked workers were confined in prison-like compounds and forced to carry out online scams on an industrial scale, preying on thousands worldwide, including many here in the United States,” said Assistant Attorney General for National Security John A. Eisenberg.

Through Prince Holding Group, Zhi directed

operation of forced-labor scam compounds across Cambodia.

Individuals held against their will in the compounds engaged in cryptocurrency investment fraud schemes, known as “pig butchering” scams, that stole billions of dollars from victims in the United States and around the world.

BehindMLM has documented hundreds of Chinese “click a button” app Ponzis since 2021. The app names and ruses change, but the typical setup requires investors to open an app and mindlessly click buttons at least once a day.

“As alleged, the defendant directed one of the largest investment fraud operations in history, fueling an illicit industry that is reaching epidemic proportions,” said U.S. Attorney Joseph Nocella Jr. for the Eastern District of New York.

The DOJ alleges these apps, and other types of fraud, have netted Zhi and his accomplices “approximately $15 billion”.

The U.S. Attorney’s Office for the Eastern District of New York and the Justice Department’s National Security Division also filed today a civil forfeiture complaint against approximately 127,271 Bitcoin, currently worth approximately $15 billion, that are proceeds and instrumentalities of the defendant’s fraud and money laundering schemes, and were previously stored in unhosted cryptocurrency wallets whose private keys the defendant had in his possession.

Those funds (the Defendant Cryptocurrency) are presently in the custody of the U.S. government. The complaint is the largest forfeiture action in the history of the Department of Justice.

Zhi, who is 38 and facing 40 years in prison, remains at large.

The US Treasury has pegged Prince Group losses at “over $16.6 billion”. On October 14th, the Treasury announced it has designated Prince Holding Group a “transnational criminal organization” (TCO).

To that end sanctions against Prince Holding Group and affiliated entities have been enacted.

Today, OFAC additionally designated a network of 117 Prince Group TCO-affiliated businesses, the vast majority of which are offshore shell companies that engage in no apparent real commercial or business activity, as well as one associated official.

OFAC has determined these entities and individual are in fact owned or controlled by, or purport to act for or on behalf of, members of Prince Group TCO.

Additionally, Treasury targeted Prince Group TCO’s burgeoning operations in Palau, where the TCO works with known organized crime facilitators to lease an island and set up resorts.

Treasury has taken this action in support of Palau’s ongoing efforts to protect against predatory investments by transnational organized criminal groups originating from the People’s Republic of China.

Palau is a micro nation in the Pacific Ocean.

FINCen has also targeted Huione Group;

In addition, FinCEN finalized a rule under section 311 of the USA PATRIOT Act to sever the Cambodia-based financial services conglomerate, Huione Group, from the U.S. financial system.

For years, Huione Group has laundered proceeds of virtual currency scams and heists on behalf of malicious cyber actors.

Of the $4 billion worth of illicit proceeds, FinCEN found that Huione Group laundered at least $37 million worth of virtual currency stemming from DPRK cyber heists, at least $36 million from virtual currency investment scams, and $300 million worth of virtual currency from other cyber scams.

As part of “complimentary” operations, UK’s FCDO has also issued sanctions against Prince Holding Group.

Zhi and Prince Holding Group defrauded consumers out of billions with the blessing of Cambodian authorities.

From the DOJ;

The defendant and a close network of Prince Group’s top executives used their political influence in multiple foreign countries to protect their criminal enterprise and paid bribes to public officials to avoid disruption by law enforcement.

In response to Zhi’s indictment and Prince Group being designated a transnational criminal organization, Cambodia’s government urged the US and UK to be fair.

Cambodia’s Interior Ministry spokesman Touch Sokhak said Prince Holding Group has met all legal requirements to operate in Cambodia and has been treated no differently than other major companies investing in the country.

He also said the Cambodian citizenship given to China native Chen was in accordance with the law.

[Sokhak] stressed that Cambodia’s government itself does not accuse Prince Holding Group or Chen Zhi of wrongdoing.

Whether Touch Sokhak was one of the Cambodian government officials Zhi paid off is unclear.