Overall, US and international authorities ramped up efforts against crypto-related crime. In Australia, a separate $123 million crypto laundering ring involving a security firm was dismantled after an 18-month investigation. Meanwhile, Telegram founder Pavel Durov publicly addressed his 2024 arrest in France, and called it politically motivated. He also called the charges against him unfounded.
US Cracks Down on Global Crypto Scam
Five men pleaded guilty to their roles in a $36.9 million international crypto scam that defrauded Americans and funneled the proceeds to a scam operation in Cambodia. According to the US Attorney’s Office for the Central District of California, the group used shell companies and US bank accounts to steal funds, later converting the money into Tether (USDT) and transferring it to wallets controlled abroad.
The defendants include Joseph Wong, Yicheng Zhang, Jose Somarriba, Shengsheng He, and Jingliang Su, and they used social media, messaging apps, and even dating platforms to build trust with victims before convincing them to invest in fake crypto ventures. In reality, the victims’ funds were never invested and were instead stolen outright. The scammers falsely claimed the investments were gaining value in order to keep the victims engaged.
(Source: US Attorney’s Office)
The laundering operation was very sophisticated and multinational. Somarriba and He created a shell company called “Axis Digital” and opened a Deltec Bank account in the Bahamas to receive the funds. Su played a key role in converting stolen money into USDT, while Wong managed a laundering network that moved funds through international bank accounts. Zhang operated two US-based bank accounts to process the illegal proceeds.
As part of the crackdown, US authorities stated that the stolen assets were eventually sent to the orchestrators of the scam based in Cambodia. Zhang and Wong noe face up to 20 years in prison for conspiracy to launder money, and are among the most severely charged. The remaining three men could face up to five years each for conspiring to run an unlicensed money services business. Su is scheduled for sentencing on Nov. 17.
These developments bring the total number of guilty pleas in connection with the scam to eight, including previous admissions of guilt from Daren Li and Lu Zhang for similar charges.
Meanwhile, the US Treasury Department is escalating its efforts to combat crypto-related crime linked to Asia. Officials proposed sanctions against the Cambodia-based Huione Group after accusing it of facilitating money laundering for North Korea’s Lazarus Group. The Treasury’s Financial Crimes Enforcement Network (FinCEN) recommended banning US financial institutions from providing correspondent or payable-through accounts to Huione, due to its role as a facilitator of malicious cyber activities.
In an apparent response to enforcement actions, one of Huione’s affiliates, Haowang Guarantee, reportedly had its Telegram communications channel shut down. Despite this, crypto analytics firm TRM Labs identified behavioral and transactional links between Haowang Guarantee and another Telegram-based entity, Xinbi.
Crypto Laundering Ring Busted in Australia
In Australia, authorities charged four people after an 18-month investigation into a $190 million AUD ($123 million USD) crypto laundering scheme that allegedly operated through a cash-in-transit security company. The Australian Federal Police worked alongside the Queensland Joint Organized Crime Taskforce, and revealed that the suspects used the armored vehicle division of a security business to disguise illegal activity as legitimate financial operations.
The investigation involved 70 officers across federal and state agencies, and began in December of 2023. So far, it led to the freezing of $13.6 million worth of suspected criminal assets in Queensland and New South Wales.
Announcement from the Australian Federal Police
The laundering operation reportedly involved mixing legitimate business revenue with illicit cash deposits from suspected criminals. These funds were then funneled through a web of front operations, including a promotional sales company, a classic car dealership, and cryptocurrency exchanges. Authorities tracked one person who allegedly laundered $9.5 million over 15 months, which helped them to uncover the whole network. The crypto funds were ultimately redistributed to beneficiaries either in digital assets or through the associated businesses.
One of the vehicles that were seized by authorities
Blockchain’s decentralized and pseudonymous nature offers criminals new avenues for laundering money, even though it provides transparency that law enforcement can take advantage of to trace illegal activity. According to data from blockchain analytics firm Chainalysis, over $100 billion in crypto moved from illicit wallets to conversion services between 2019 and mid-2024. Criminals did this by developing increasingly advanced tactics, like using mixers, DeFi protocols, and cross-chain bridges to obscure transactions and evade detection.
Beyond digital deception, crypto-related crime is increasingly manifesting in the physical world. Moroccan police recently arrested a man linked to multiple crypto-related kidnapping attempts, including one targeting the family of Paymium CEO Pierre Noizat. In another incident, Ledger co-founder David Balland was kidnapped in France and held hostage before being rescued.
Pavel Durov Speaks Out on Arrest in France
Telegram founder Pavel Durov recently broke his silence about his arrest in France last August. He talked about his confusion over the incident and suggested it may have been politically motivated.
In an interview with Tucker Carlsonthat was shared on YouTube, Durov said he is still unsure why he was detained at Paris’s Bourget Airport on Aug. 24, 2024. French authorities indicted him on six charges, including complicity in criminal activity, money laundering, providing unauthorized crypto services, and facilitating the spread of illicit content through Telegram’s loosely moderated channels.
Durov said the charges were bewildering, especially given Telegram’s efforts to comply with international laws. He explained that the company is audited by a Big Four accounting firm, works with major financial institutions, and spends millions every quarter on legal compliance to ensure it follows the rules in all 200 countries where it operates. He insisted that Telegram responded to all legally binding requests from French authorities and claimed the accusations were based on a misrepresentation of the facts and an expansive interpretation of legal responsibility.
Carlson criticized the arrest as a targeted act of humiliation, and Durov agreed by saying the process deviated from how the French prosecutor's office typically handles such cases. Durov’s lawyers described the arrest as “unprecedented,” as the prosecutor issued unusually public statements and took actions that were out of step with standard legal procedure. Durov is still under certain movement restrictions, and said the rationale behind his continued legal troubles are unclear to him.
Pavel Durov
In the wake of his arrest, Durov warned that Telegram might exit countries whose legal systems clash with its commitment to privacy and free expression. The incident also caused a lot of global concern among Telegram users, with more than 9 million signing an open letter demanding his release.
Despite the controversy, Telegram continues to expand. In March of 2025, the platform surpassed one billion monthly active users.
