Chinese National Zhao Zheng Extradited from Netherlands to the U.S. for Crypto Fraud Case
A 44-year-old Chinese national, Zhao Zheng, was extradited from the Netherlands to the Central District Court of California, USA, due to allegations of participating in a transnational crypto investment fraud and money laundering conspiracy targeting American citizens. He appeared in court for the first time on the same day and was ordered to be detained.
The network, based in a Cambodian scam center, actively contacted American victims through social media, phone calls, text messages, and dating platforms, guiding them to fake websites that impersonated real cryptocurrency trading platforms, falsely claiming that investments were continuously appreciating to entice them to transfer funds.
Over $36.9 million of victim funds were concentrated into a single account at Deltec Bank in the Bahamas from U.S. bank accounts controlled by the network. Zhao Zheng and other conspirators arranged for the bank to convert the funds into USDT stablecoins, which were then transferred to digital asset wallets controlled by Cambodia.
Cambodian co-conspirators subsequently distributed the USDT to local and regional scam center leaders, with the funds being transferred through multiple layers involving U.S. shell companies, international bank accounts, and digital asset wallets to obscure their source.
At least 174 American victims have been confirmed, and 8 co-conspirators have pleaded guilty (including ShengSheng He and Jingliang Su, who were sentenced to 51 months and 46 months in prison, respectively). Zhao Zheng is charged with conspiracy to commit money laundering, facing up to 20 years in federal prison if convicted, and is scheduled to appear in court again on November 30.
Victims "purchased" non-existent investments on the fake platform, with funds actually being sold and flowing through the U.S. bank—Bahamas Deltec—USDT channel to the Cambodian scam network, representing a typical event-driven cross-border money laundering case. The stablecoin and offshore bank intermediaries are under pressure, with U.S. law enforcement continuing to pursue the beneficiaries.
Source: Public Information
ABAB AI Insight
The network involving Zhao Zheng is directly linked to the same series of cases concluded in the Central District of California in 2025: Joseph Wong, Yicheng Zhang, Jose Somarriba, Shengsheng He, and Jingliang Su pleaded guilty to the same $36.9 million Deltec path, with He and Su already sentenced, indicating that the money laundering intermediary layer is being systematically dismantled, while Zhao Zheng, as a subsequent extradition target, fills the European transit node.
The funding path is highly standardized: U.S. victim bank accounts → shell company aggregation → single account at Deltec Bank Bahamas (under Axis Digital Limited) → conversion to USDT → Cambodian wallet → distribution to leaders of parks like Sihanoukville, motivated by the use of stablecoins for cross-border instant settlement and weak regulation of offshore banks, rapidly converting U.S. fiat into regionally allocable digital assets, evading traditional wire transfer tracking.
This is part of a larger-scale Cambodian park led by Chen Zhi of Prince Group (previously sanctioned by the U.S. and U.K. and involved in the seizure of billions of dollars in Bitcoin), currently in a phase of expansion and control under the U.S. "Cyber-Enabled Scam Initiative" and Scam Center Strike Force: intermediary banks and stablecoin channels are being critically severed, and park leaders are beginning to face extradition and asset freezes.
Essentially, it is a restructuring of the industry chain driven by regulatory changes: law enforcement is shifting from merely recovering assets to systematically cutting off key nodes of "U.S. money collection—Bahamas aggregation—USDT outflow," forcing scam networks to shift from decentralized intermediaries to more concealed or alternative settlement paths, as the traceability of stablecoins and offshore banks, once penetrated by the judiciary, significantly compresses traditional money laundering efficiency.
ABAB News · Cognitive Law
- Stablecoins are a fast track for cross-border money laundering.
- Park leaders profit from the distribution price difference of intermediaries.
- Once extradition costs decrease, offshore nodes become immediately ineffective.