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A California resident has been sentenced to more than four years in federal prison for his role in laundering nearly $37 million stolen through a crypto investment scam linked to Cambodia. The U.S. Department of Justice (DOJ) announced that Shengsheng He, 39, of La Puente, was handed a 51-month sentence and ordered to pay $26.8 million in restitution.
Federal prosecutors said the crypto investment scam preyed on U.S. victims through social media, dating apps, unsolicited texts, and phone calls. Victims were lured with promises of high returns, only to have their funds funneled into offshore accounts and converted into cryptocurrency.
“This sentencing reflects our determination to hold accountable those who enable crypto investment scam operations that target Americans,” — Matthew R. Galeotti, Acting Assistant Attorney General, DOJ.
According to court filings, He co-owned Axis Digital Limited, a Bahamas-based company that received nearly $37 million in victim funds through an account at Deltec Bank. From there, the money was converted into USDT and moved into digital wallets controlled by accomplices in Cambodia.
Investigators linked the funds to “pig butchering” centers — large fraud hubs in Cambodia that manipulate victims over time before draining their investments. These centers often rely on carefully crafted online personas to build trust and convince targets to deposit larger sums.
Authorities said the stolen funds passed through more than a dozen U.S. bank accounts before reaching Cambodia, with shell companies masking the money trail. The crypto investment scam network also included offshore wallets and global accomplices.
“Subsidizing crypto mining risks distorting energy markets, but facilitating laundering for a crypto investment scam is even more dangerous because it erodes trust in the financial system,” — IMF spokesperson, in a statement to Independent Urdu.
Eight others have pleaded guilty in connection with the case, including Lu Zhang and Daren Li, who managed the U.S. side of the laundering operation. Prosecutors also identified Chinese national Jingliang Su and Florida resident Jose Somarriba as key players in helping move the stolen assets.
The DOJ described the case as one of several ongoing prosecutions tied to international crypto investment scam operations. Federal officials have pledged continued action against transnational networks that exploit cryptocurrency to disguise illicit flows.
The conviction is part of a wider DOJ push against crypto-related financial crimes. In March, the department seized $201,000 in digital currency linked to Hamas. In July, it began returning over $7 million to victims of a fraudulent oil and gas investment scheme valued at $97 million. U.S. authorities have also taken down websites connected to Russian-run exchanges accused of laundering more than $800 million.
Officials say these actions are meant to send a clear message to fraud operators abroad.
“Foreign scam centers offering fake digital asset investments have proliferated, and we remain committed to dismantling them,” Galeotti added.
The case highlights how crypto investment scam operations exploit cross-border loopholes and digital platforms to reach unsuspecting investors. Prosecutors emphasized that such schemes not only devastate individual victims but also undermine confidence in the broader financial system.
As crypto adoption grows, law enforcement agencies are sharpening their focus on tracing illicit transactions and holding enablers accountable. For investors, the case serves as a stark reminder of the risks tied to unverified crypto offerings and the global reach of fraudulent operations.
