Arrests Made for $10 Million Cryptocurrency Fraud

Three individuals in the United States have been arrested for allegedly stealing $10 million from financial institutions and using cryptocurrency exchanges to launder the stolen funds. If found guilty, the accused could face over 80 years in prison.

Defrauding Banks and Channeling Proceeds to Crypto Exchanges

The U.S. Attorney’s Office for the Southern District of New York announced the arrest of Zhong Shi Gao, Naifeng Xu, and Feo Jiang by the Federal Bureau of Investigations (FBI). They are accused of orchestrating a complex fraud scheme targeting banks and financial institutions in the United States.

The trio allegedly hired Chinese and Taiwanese individuals living in the United States to open bank accounts in New York and other areas, and then took control of these accounts to facilitate fraudulent deposits, transfers, and unauthorized wire transfers.

Following the receipt of the fraudulently obtained money, Gao, Xu, and Jiang would either make cash withdrawals or convert the funds to cryptocurrency and transfer them to overseas exchanges before the banks detected the fraudulent reports.

The illicit activity spanned from 2018 to 2022, resulting in over $10 million in stolen funds that affected nearly a dozen banks and financial institutions.

Maximum Jail Term of 82 Years if Guilty

The accused are each facing one count of bank fraud conspiracy, one count of wire fraud conspiracy, one count of money laundering conspiracy, and one count of aggravated identity theft. The charges carry a maximum prison sentence of up to 30 years, 30 years, 20 years, and 2 years, respectively.

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U.S. Attorney Damian Williams warned that criminals using cryptocurrency to conceal their identities will be found and held accountable for their crimes.


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