Chinese crypto fraudster pleads guilty to laundering $12b

Around 61,000 Bitcoin was seized from a West London house in 2018 as part of the case. Photo / Getty Images

A Chinese woman alleged to be behind a huge investment fraud pleaded guilty to charges she used Bitcoin to launder criminal money, in a case that stems from one of the largest cryptocurrency seizures ever by British police.

Yadi Zhang, 47 and also known as Zhimin Qian, pleaded guilty to charges of possessing and transferring criminal property, while her assistant Seng Hok Ling, also 47, pleaded guilty to dealing crypto at a London court this week. Their guilty pleas came on the eve of their 12-week trial. The pair will be sentenced on November 10.

The case stems from the seizure of around 61,000 Bitcoin from a West London house in 2018. That’s now worth almost US$7 billion ($12b) and represents one of the largest cryptocurrency hauls law enforcement have recovered anywhere in the world.

Zhang was instrumental in a fraud that helped generate much of that illicit cash, while Ling worked to help her move money into cryptocurrency accounts.

Another woman, Jian Wen, was found guilty of laundering Bitcoin at a trial last year and was sentenced to more than six years in jail. Wen lived with Zhang in Hampstead and who prosecutors dubbed a “super villain” during the trial.

By pleading guilty “Ms Zhang hopes to bring some comfort to investors who have waited since 2017 for compensation” her lawyer, Roger Sahota, said.

Wen worked at a fast food takeaway in east London before she started working with Zhang in 2017. In a matter of weeks, she went from living in the restaurant’s basement to a luxurious lifestyle that included a six-bedroom house, foreign trips and shopping sprees.

Chinese police started investigating a suspected fraudulent investment project in Tianjin, China, in 2017 that had swindled over 128,000 people across the country, UK prosecutors said at the trial. The investigation uncovered a fraud involving a company called Tianjin Lantian that lured investors with the promise of high returns. Unsuspecting investors had a total of 40 billion yuan ($9.6b) stolen and 14 Chinese nationals have been convicted in connection with the crime.

The sentencing of Ling and Zhang brings criminal proceedings in the UK to a close, the focus will now shift to civil cases over where the seized crypto will end up between out-of-pocket investors and the UK Government.

“Bitcoin and other cryptocurrencies are increasingly being used by organised criminals to disguise and transfer assets, so that fraudsters may enjoy the benefits of their criminal conduct,” Robin Weyell, deputy chief crown prosecutor for the Crown Prosecution Service, said on Monday.

“The CPS will now work to ensure, through criminal confiscation and civil proceedings, that the criminal assets remain beyond the fraudsters’ reach.”

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