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Cambodia Extradites Billionaire Linked to Cryptocurrency Scam

Cambodia has announced the extradition of Chen Zhi, a billionaire businessman, to China, where he is accused of orchestrating a massive cryptocurrency scam. This fraudulent scheme reportedly involved the trafficking of workers who were lured under false pretenses and subsequently forced into labor camps, where they defrauded victims worldwide.

Arrest and Charges Against Chen Zhi

Chen Zhi, along with two other Chinese nationals, was apprehended on January 6 as a result of an extensive months-long joint investigation focused on transnational crime. This investigation aimed to dismantle networks involved in organized crime spanning multiple countries. Last October, U.S. authorities charged the 37-year-old Zhi with operating internet scams from Cambodia, asserting that he had pilfered billions in cryptocurrency through these illicit operations. The United Kingdom has also imposed sanctions on his international enterprise, known as Prince Group.

Suspension of Banking Operations

Following these developments, Cambodian authorities have taken significant steps against Prince Bank, a subsidiary of Prince Group. They have temporarily suspended the bank’s operations and ordered it into liquidation. While the bank is prohibited from offering new banking services, customers are still permitted to withdraw funds and repay loans, according to an announcement by the National Bank of Cambodia on Thursday.

Confirmation of Extradition by Chinese Media

Chinese state media confirmed the extradition of Chen Zhi, characterizing him as the leader of a major cross-border gambling and fraud syndicate. Reports allege that he is suspected of various crimes, including operating illegal casinos, committing fraud, and concealing the proceeds of criminal activities. According to CCTV, Chen Zhi has been subjected to "coercive measures in accordance with the law."

Furthermore, Chinese public security organs have stated that there will soon be arrest warrants issued for the primary members of Chen Zhi’s criminal organization, emphasizing their commitment to bringing fugitives to justice. They have also publicly warned other criminals to recognize the severity of their actions and to surrender voluntarily to receive leniency.

Seizure of Assets by U.S. Authorities

In a significant move the previous year, U.S. authorities seized approximately $15 billion worth of bitcoin, believed to belong to Chen Zhi. FBI Director Kash Patel referred to this seizure as "one of the largest financial fraud takedowns in history." This operation has underscored the serious nature of the allegations against Chen Zhi and his network.

The BBC reached out to Prince Group for comments regarding the situation, but the company has consistently denied any involvement in fraudulent activities. Its official website outlines a diverse range of business operations, including property development, as well as financial and consumer services.

Chen Zhi’s Uncertain Presence and Departure from Cambodian Nationality

Following the U.S. indictment on fraud and money-laundering charges, the exact whereabouts of Chen Zhi had remained ambiguous. Nevertheless, Cambodian authorities confirmed on Wednesday that they had detained three Chinese nationals: Chen Zhi, Xu Ji Liang, and Shao Ji Hui, and successfully extradited them to the People’s Republic of China. Notably, the Cambodian interior ministry did not disclose the location of Chen Zhi’s prior detention.

Last month, his Cambodian nationality was revoked by royal decree, a significant legal development considering that Chen Zhi had renounced his Chinese nationality in 2014 to acquire Cambodian citizenship.

The Trafficking Crisis in South East Asia

The United Nations has estimated that hundreds of thousands of individuals have been trafficked to South East Asia, with many arriving in Cambodia under the guise of legitimate employment offers. These individuals often end up held against their will in scam farms, forced to run online scams under threats of physical punishment or torture. Many of the victims targeted by these scams are Chinese citizens.

Ongoing Investigations into Prince Group

In a parallel development, Chinese authorities have been conducting discreet investigations into Prince Group since at least 2020. The company is implicated in various court cases related to online fraud schemes. The Beijing Municipal Public Security Bureau has established a task force aimed at investigating Prince Group, labeling it a significant transnational online gambling syndicate based in Cambodia.

Cambodian Government’s Relationship with Chen Zhi

The Cambodian government has historically maintained close connections with Chen Zhi. Since the imposition of sanctions by the U.S. and U.K. on Prince Group, officials have remained largely silent, urging American and British authorities to ensure they possess adequate evidence to substantiate their claims.

According to some estimates, scam businesses could constitute nearly half of Cambodia’s entire economy. Journalist Jack Adamovic Davies noted, "I think the sheer scale of his operations really makes Chen Zhi stand out." He expressed astonishment that the Prince Group had managed to establish a "global footprint" without drawing significant attention, given the serious criminal allegations it now faces.

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