The U.S. government has taken decisive action against a prominent Cambodian businessman, seizing over $14 billion in bitcoin and charging him in connection with an extensive cryptocurrency fraud scheme. The founder of Prince Holding Group, Chen Zhi, along with unnamed collaborators, is accused of exploiting forced labor to mislead potential investors and using the illicit gains to finance extravagant purchases, including yachts, jets, and even a Picasso painting. An indictment made public on Tuesday by federal prosecutors in Brooklyn outlines charges against Chen for conspiracy to commit wire fraud and money laundering. Concurrently, U.S. and British authorities have imposed sanctions on Chen’s company, which is involved in real estate and financial services, designating it a transnational criminal organization.
### Allegations of Violence and Fraud
Chen, 38, stands accused of endorsing violence against employees, facilitating bribes to foreign officials, and employing businesses such as online gambling and cryptocurrency mining to launder illegal profits. Assistant Attorney General John Eisenberg labeled Chen as the “mastermind of a vast cyber-fraud network,” while U.S. Attorney Joseph Nocella described it as “one of the largest investment fraud operations in history.” Prosecutors noted that Chen once claimed the so-called “pig butchering” scam generated up to $30 million daily.
### A Major Player in a Growing Scam Environment
According to the Treasury Department, Americans lost at least $10 billion to scams originating from Southeast Asia last year, marking a staggering 66% increase from 2022. The government has identified Prince Holding Group as a “dominant player” within this fraudulent landscape. Chinese authorities have been investigating the company for cyber scams and money laundering since at least 2020, as indicated by court records. Chen, who is also known as “Vincent,” remains at large while facing potential imprisonment of up to 40 years if convicted. Should the court allow it, the U.S. may use the 127,271 bitcoins it confiscated to compensate victims, though the value of these coins, currently around $113,000 each, is subject to fluctuation.
### Expert Insights on the Criminal Network
Jacob Daniel Sims, a transnational crime specialist and visiting fellow at Harvard University’s Asia Center, remarked that Prince Holding Group plays a crucial role in the infrastructure that enables global cyber-scamming activities, with Chen acting as a “central pillar” of the criminal economy closely linked to Cambodia’s ruling regime. Chen has previously advised Prime Minister Hun Manet and his father, former Prime Minister Hun Sen, and has been awarded the title “neak oknha,” which is comparable to an English lord. Sims noted that while the indictment and sanctions may not immediately dismantle these networks, they significantly alter the risk assessment for global banks, real estate firms, and investors considering associations with Cambodia’s elite.
### Conditions of Forced Labor
The indictment reveals that Prince Holding Group established at least ten facilities in Cambodia where workers—often migrants held against their will—were compelled to communicate with thousands of potential victims via social media or online messaging. They were trained to build relationships and encourage victims to invest cryptocurrency under false pretenses. Prosecutors assert that the money raised was redirected to support other Prince Holding Group enterprises and shell companies, funding lavish travel, luxury items, and even a Rolex watch for an executive’s spouse. One victim reportedly lost over $400,000 in cryptocurrency.
### Harsh Realities Behind the Facade
The facilities operated by Prince Holding Group were likened to forced labor camps, featuring dormitories enclosed by high walls and barbed wire, as well as automated call centers equipped with hundreds of mobile phones managing tens of thousands of fake online profiles. One of these locations was linked to the company’s Jinbei Casino Hotel, while another was referred to as “Golden Fortune.” The Treasury Department’s sanctions statement details that workers at these sites were held captive, isolated, and sometimes subjected to beatings after being promised high-paying positions in customer service or tech support. Disturbing photographs presented in the indictment illustrate the brutal conditions, showing individuals with visible injuries and signs of severe abuse. Chen allegedly sanctioned at least one incident of violence against a worker deemed problematic but advised that the individual not be harmed fatally.
### The Broader Impact of Cyber Scams
In 2023, the United Nations estimated that approximately 100,000 individuals in Cambodia were being coerced into participating in online scams, with additional figures of at least 120,000 in Myanmar and tens of thousands more in Thailand, Laos, and the Philippines. Sims emphasized that while these actions won’t eradicate the scam economy immediately, they do diminish its resources and send a critical message to regimes like Cambodia’s that leveraging elite crime as a governing strategy comes with significant risks.
