China Extradites Mastermind Behind $14 Billion Crypto Scam in Landmark Operation

China has successfully extradited a suspect identified as Zhang from Thailand, who is accused of orchestrating a $14 billion cryptocurrency pyramid scheme.

This marks the first time a financial crime suspect has been extradited under the China-Thailand treaty, which has been in place since 1999.

According to China’s Ministry of Public Security, Chinese and Thai authorities collaborated on the extradition as part of a special task force called “Hunting Fox.” Zhang was extradited to China on Wednesday.

The alleged scheme, known as “MBI Group,” began in 2012. Zhang reportedly enticed investors to pay fees ranging from 700 yuan ($98) to 245,000 yuan ($34,300) in exchange for cryptocurrency memberships. The scheme reportedly drew in over 10 million members and involved over 100 billion yuan ($14 billion).

READ MORE:

Turkish Authorities Arrest Crypto Founder for $4 Billion Pyramid Scheme

Chongqing police launched an investigation into Zhang in November 2020. In March 2021, Interpol’s Chinese branch issued a red notice for his arrest. He was detained in Thailand in July 2022, and a Thai court approved his extradition to China in May this year.

Although China banned cryptocurrency trading in 2021, many investors have continued to seek ways around the ban. In May, Chinese authorities dismantled an underground bank using USDT stablecoin for foreign currency exchanges, involving transactions totaling at least 13.8 billion yuan ($1.9 billion).

Additionally, China’s top legal authorities recently classified the use of cryptocurrencies for illicit fund transfers as a form of money laundering, making it easier for law enforcement to address crypto-related crimes.

Alexander Stefanov