Chinese Authorities Burst $1.5M USDT Fraud Scheme, Remands 4 Suspects

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Chinese Authorities Burst $1.5M USDT Fraud Scheme, Remands 4 Suspects
  • Four people were arrested in China for a crypto fraud scheme involving over $1.5 million.
  • The suspects lured victims by encouraging them to invest in stocks and then crypto.
  • The fraud group convinced the victims to transfer their USDT to a different wallet they controlled.

In a recent report from a Chinese news agency, four individuals suspected of engaging in a complex crypto fraud scheme have been apprehended. The suspects allegedly conspired with an overseas fraud group to orchestrate a grand crypto scheme.

The scheme involved enticing victims to purchase Tether USD (USDT) and subsequently urging them to transfer the USDT to a wallet the group controlled. According to the report, preliminary estimates indicated that the magnitude of the fraudulent activities surpasses 50 million yuan or  $1,565,984.

The prosecution team revealed that the overseas fraud group lured victims via the LINE chat group, where they initially encouraged the unsuspecting victims to invest in stocks. After securing minor profits, victims were then induced to invest in crypto.

Furthermore, the report mentioned that the fraudulent currency dealers, including Li Nv, Hong Nv, Dai Nan, and Zhang Nan, taught the victims step-by-step guidance on setting up crypto wallets.

After the victims received their purchased USDT, the fraud group allegedly employed various tactics to persuade them to transfer their Tether holdings to a different crypto wallet. Interestingly, the persecution noted that the fraud group established counterfeit websites and applications to gain victims’ trust.

Regrettably, the victims’ USDT ultimately found their way into a crypto wallet controlled by the fraud group. The four counterfeit currency dealers allegedly withdrew the funds received from victims after converting them. They also attempted to obscure the source of the funds to avoid detection.

According to investigations by prosecutors, at least ten people fell victim to the scheme. The largest individual loss exceeded TWD 4 million, equivalent to approximately $125,278. The total stolen fund was estimated to be TWD 50 million, equivalent to $1,565,984.

Notably, the prosecution team has submitted an application against the suspects to a Chinese District Court, with the court approving the detention of the four defendants.