Crypto fraudster pleads guilty of taking part in $73 million laundering scheme

A Chinese dual citizen has pleaded guilty for his involvement in laundering $73 million obtained through multiple crypto fraud schemes. 

Daren Li, 41, pleaded guilty to conspiracy to commit money laundering. Prosecutors revealed in a plea agreement filed on Monday in a federal court in California that the scheme generated millions through various crypto investment scams, including “pig butchering” fraud, from August 2021 to April 12, 2024.

Li admitted to directing associates to open US-based bank accounts under shell companies to conceal illicit funds' nature, location, source, and ownership.

Nicole M. Argentieri, head of the Justice Department’s Criminal Division, stated on Tuesday that Li orchestrated the crime from outside the US, leveraging “a web of shell companies and international bank accounts.”

Shell companies, US accounts used to launder funds

Victims transferred millions into accounts, converted to Tether (USDT), and sent them to wallets Li and his accomplices managed. Court records show that one of these wallets received over $341 million in digital assets.

Li has confirmed that $73.6 million of the misappropriated funds went directly into bank accounts linked to the operation. At least $59.8 million was deposited from US-based shell companies laundering the proceeds.

Li was detained on April 12 at Atlanta airport, while his alleged partner, Yicheng Zhang, was apprehended in Los Angeles on May 16. After Li's guilty plea, the judge has scheduled the sentence for March 3, 2025.

Li could receive a maximum sentence of 20 years in prison, three years of supervised release, and a fine of $500,000 or double the financial gains from the crime, whichever is higher.