A federal judge has sentenced Shengsheng He of La Puente, California to 51 months in prison after he admitted helping launder nearly $37 million stolen from U.S. investors in a global crypto investment scam. He was also ordered to pay $26.9 million in restitution, prosecutors said.
According to the Department of Justice, He pleaded guilty in April to conspiracy to operate an unlicensed money-transmitting business and acknowledged co-owning Axis Digital Limited, a Bahamas-based shell company used to receive victims’ funds. The scheme used unsolicited messages, phone calls and dating apps to build trust, then promoted fake digital-asset investments while diverting the money into offshore accounts.
Victims’ wire transfers were consolidated into a single Axis Digital account at Deltec Bank in the Bahamas, converted into the stablecoin Tether (USDT), and moved to wallets controlled by scammers. Prosecutors say the operation routed funds through additional shell companies and foreign accounts to obscure origins.
Investigators tied the fraud to Cambodian “pig butchering” centers — high-volume social‑engineering operations that, according to Chainalysis, accounted for roughly $9 billion of fraud in 2024. Eight co-conspirators have pleaded guilty in the Axis Digital matter, including business partners Jose Somarriba and Jingliang Su, who helped convert and transfer stolen funds.
This case is part of a broader Justice Department push against crypto-enabled crime. Recent actions include seizures of crypto linked to terrorist financing, returning millions to fraud victims, and disrupting offshore exchanges alleged to have processed large volumes of illicit transactions.
Why it matters: The sentence underscores increasing U.S. enforcement of cross-border crypto laundering and highlights persistent risks for investors engaging with unvetted online offers. Businesses and intermediaries should review compliance controls, and users should be wary of unsolicited investment outreach.
Source: Decrypt. Read the original coverage for full details.