Federal prosecutors say they have recovered 127,271 Bitcoin — currently worth about $15 billion — from a sprawling “pig butchering” scam network that mixed industrial-scale social engineering with human trafficking and violence. In a detailed indictment unsealed in Brooklyn, prosecutors charged that alleged ringleader Chen Zhi, a UK and Cambodian national also known as “Philip,” and his associates erected a sprawling global enterprise that scammed victims since 2015 and laundered their ill-gotten gains through an intricate web of shell companies and cryptocurrency wallets.
Officials said the takedown was the largest cryptocurrency seizure to date by the Department of Justice, and it casts new light on a type of romance-style investment scam that has become a global criminal enterprise.
Biggest Cash Seizure in Cryptocurrencies
The group ran a 1,250-device phone farm managing over 76,000 social media accounts to pinpoint targets, build relationships with victims, and push them into phony crypto investments, the indictment says. The ring also operated at least 10 forced labor compounds in Cambodia where trafficked workers were coerced to run the cons under threat of violence, prosecutors said — a claim that echoes similar findings by the United Nations Office on Drugs and Crime about cyber scam compounds across Southeast Asia.
Officials say the operation used bribery to evade enforcement and routed funds through accounts linked to shell companies in Brooklyn and Queens from U.S. victims. The indictment paints a picture of lavish spending with the ill-gotten gains, including lucrative real estate, yachts, watches, and private aircraft — even fine art bought through a New York auction house.
The accused leader, who has been publicly connected to the Prince Group amalgamated companies, is still at large. However, should he be caught, wire fraud and money laundering charges could carry a decades-long statutory maximum sentence for him. Prosecutors explain that the seizure “lays a foundation for potential victim restitution” by the federal forfeiture process to the extent that the government recovers money. The federal forfeiture process is directed by the Justice Department and the U.S. Marshals Service.
How the pig-butchering scheme operated at scale
“Pig-butchering” combines long-term social engineering with risky transaction pretense. Con artists gain the trust of their victims on dating software, messaging applications, or social accounts and subtly encourage them to make payments into fraudulent trading programs or addresses. When the target is “fattened,” withdrawal of funds is prevented, and the assets are drained.
The prosecution provides a glimpse into a large industrial operation: highly efficient mobile call hacks with scripts, well-designed, functioning transaction dashboards, and 24-hour WhatsApp messages imitating local consensus.
Numerous victims, as per the complaint, cashed out retirement accounts or borrowed money, believing they were making genuine investments. Investment-fraud losses have skyrocketed across the broader system. The FBI’s Internet Crime Complaint Center’s 2023 report estimates that total losses from investment scams amounted to $4.57 billion, with a significant portion accounted for by fraud schemes. Similarly, Chainalysis has reported a high-risk criminal organization’s ongoing pig-butchering routine. Local police have used blockchain tracking technology and prosecutions to confiscate millions of dollars in stolen cryptocurrency in recent years.
In addition to the financial damage, officials stressed the human toll. The indictment says the trafficked workers had been attracted to Cambodia with promised jobs, then held in compounds and forced at knifepoint, under threat of beating and other forms of abuse, into duping victims. UNODC and human rights groups have documented similar trends in parts of Cambodia, Laos, and Myanmar where criminal syndicates have converted scam compounds into cash cows driven by slave labor.
The DOJ notes this case is one piece of a larger, integrated strategy by dozens of federal agencies and international partners to combat criminal organizations including human trafficking groups — bringing them to justice and providing support to victims. Although the inquiry focuses on crypto flows, law enforcement officials said that underlying these crimes are human trafficking and coercion, with technology being used as a force multiplier.
What happens next following the massive Bitcoin seizure
Investigators followed the Bitcoin through clusters of addresses they claimed to be related to the ring, in some cases using blockchain analytics and traditional financial records that connected wallets with corporate entities and, in the case of Baratov, to real people. In the defendant’s case, prosecutors filed a civil forfeiture complaint to seize the 127,271 BTC in order to secure assets while allowing the criminal case against Lavrinovich to continue — a tactic the U.S. government has used in other high-profile cryptocurrency seizures to keep funds from being dissipated.
Seized crypto is typically held in secure wallets and then liquidated later, with the money released to victims as compensation through DOJ’s remission process — assuming the court approves. Police said further arrests, asset freezes, and actions with overseas authorities could follow as the probe expands.
For consumers, the case signifies a severe warning that even the most advanced fraud in the 21st century can begin with a high-spirited message. Some of the ways to identify a potential scam include:
- Unsolicited investment tips promising outsized profit
- Pressure to withdraw funds from reputable exchanges or banks
- Returns visible only within a specific app or platform
Authorities recommend that any victims report their experience to the FBI’s Internet Crime Complaint Center, submitting copies of all communications and wallet addresses. If the case holds up, the $15 billion Bitcoin seizure represents an unparalleled peak for cryptocurrency enforcement — and a milestone in the effort to dismantle pig-butchering networks that involve financial fraud and human exploitation on a global scale.