Why Are Americans a Prime Target for Crypto Scammers?

$37 Million Crypto Scam: Five Men Admit Guilt in U.S. Fraud Scheme

In a sweeping display of international cybercrime enforcement, five individuals have pleaded guilty for their roles in a massive $36.9 million cryptocurrency investment scam that victimized American citizens. The stolen funds were funneled through shell companies in the United States and money laundering entities in Cambodia.

The scheme unfolded over months of online manipulation, during which the defendants—Joseph Wong, Yicheng Zhang, Jose Somarriba, Shengsheng He, and Jingliang Su—used social media, dating apps, and messaging platforms to gain victims’ trust. Once hooked, victims were convinced to invest in a fraudulent crypto venture. They were falsely told their investments were rising in value, when, in reality, those funds were transferred into shell accounts, converted to Tether (USDT), and sent overseas.

Anatomy of the Scam

The operation’s structure was chilling in its sophistication and reach. According to court documents:

• Somarriba and He established a Bahamas-based shell company named Axis Digital and opened a Deltec Bank account to receive victim funds 

• Zhang operated two U.S. bank accounts that processed the incoming money 

• Wong orchestrated an international money-laundering network, shifting funds through various accounts 

• Su acted as a director handling conversions to USDT and transfers to wallets hosted in Cambodia 

Once the funds landed in Cambodia, they were sent onward to scam centers and laundered through foreign accounts, making recovery exceedingly difficult.

Legal Consequences and Sentencing

Prosecutors have pursued the defendants on multiple fronts. Wong and Zhang, currently in custody, have pleaded guilty to money‑laundering conspiracy and face up to 20 years in federal prison. Somarriba, He, and Su admitted to running an unlicensed money services business and could each face up to five years behind bars. Su’s sentencing is set for November 17, and he was taken into custody in November 2024.

Source: X

These five defendants are among eight who have pleaded guilty in connection with the scheme, including earlier pleas from individuals such as Daren Li and Lu Zhang.

Why Americans Are Attractive Targets

The United States remains a primary target for international cryptocurrency scams. Its population includes many individuals curious or actively involved in digital assets but lacking sufficient knowledge of associated risks. This combination—a wealthy, digitally connected consumer base and easily exploited trust—makes U.S. citizens particularly vulnerable.

Additionally, U.S. victims are often seen as lucrative targets, and funds are easier to funnel through U.S. banking systems before converting to stablecoins like USDT for international transfer.

A Broader Fight: Targeting Laundering Networks

The Justice Department’s actions reflect a growing crackdown on digital asset scams and associated money laundering, particularly in Southeast Asia. This broader campaign includes efforts against criminal networks such as North Korea’s Lazarus Group.

In May 2025, the U.S. Treasury’s FinCEN designated Cambodia‑based Huione Group as a primary money‑laundering entity, citing its role in “pig butchering” romance scams and North Korean cyber‑thefts. FinCEN proposed rules to cut Huione off from U.S. banking channels. In recent weeks, affiliated operators such as Haowang Guarantee have lost Telegram channels and communication routes.

Pig Butchering and Romance Scams

Coined for their method of “fattening up” victims through emotional manipulation, pig butchering and romance frauds have netted billions from Americans and others globally. Victims are groomed over weeks or months via fake romantic and financial promises. Financial transfers then escalate under false pretenses before the scammers abruptly disappear.

One illustrative case involved a North Carolina man defrauded of $3.4 million after a romance-based investment pitch. The stolen funds were traced to Huione-controlled wallets.

Challenges in Law Enforcement

Investigators face systemic hurdles in dismantling these networks. Despite FinCEN’s actions, analysts at Elliptic and Chainalysis warn that over 30 similar marketplaces still facilitate global crypto crime These platforms provide one-stop marketplaces for scammers to purchase victim data, build phishing tools, and launder proceeds.

Cambodia-based operations are particularly opaque, operating across borders with minimal regulatory oversight.

Effect on Victims and Future Prevention

The impact on victims is devastating—both financially and emotionally. In high-profile cases, individuals have lost life savings, retirement accounts, and personal trust. Witnesses tell of overnight fortunes disappearing under false investment promises by supposed friends or romantic partners.

In response, U.S. lawmakers are pushing for stronger oversight measures. Bills like the Romance Scam Prevention Act would require dating platforms to warn users of suspicious patterns and connections.

Cryptocurrency platforms are also being pressured to enhance compliance, improve traceability, and freeze illicit funds proactively.

Conclusion: Ongoing Global Cooperation

While today’s guilty pleas mark a significant legal milestone, experts stress this as the beginning, not the end, of a transnational effort against crypto fraud. U.S. officials continue forging international partnerships to target laundering networks and criminal exchanges.

The success in prosecuting these five men highlights a critical message: digital asset recipients operating across borders are not immune from justice. As global cooperation improves, authorities hope to sever the financial lifelines of crypto criminals.

Yet the evolving nature of cybercrime means vigilance and innovation must continue. Victims must remain alert, regulators must strengthen AML/KYC protocols, and the public must know that what appears as a novel investment could, in fact, be a manipulative and devastating scam.

Writer @Erlin

Erlin is an experienced crypto writer who loves to explore the intersection of blockchain technology and financial markets. She regularly provides insights into the latest trends and innovations in the digital currency space.

 

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