LOS ANGELES, CA – A California man was sentenced to 51 months in federal prison for his role in laundering more than $36.9 million from victims in an international digital asset investment scam operated from Cambodia. The court also ordered him to pay $26,867,242.44 in restitution to victims.
According to the Justice Department, 39-year-old Shengsheng He of La Puente, California, a former co-owner of the Bahamas-based Axis Digital Limited, pleaded guilty on April 10 to conspiracy to operate an unlicensed money transmitting business in the Central District of California.
Court records show He and his co-conspirators induced U.S. victims to transfer funds into accounts controlled by the group. The money was laundered through U.S. shell companies, international bank accounts, and digital asset wallets before being converted to the stablecoin Tether (USDT) and transferred to scam centers in Cambodia.
Eight co-conspirators have pleaded guilty in connection with the scheme, including Daren Li, a national of China and St. Kitts and Nevis, and Lu Zhang, a Chinese national who managed a network of U.S.-based money launderers. Both pleaded guilty to conspiracy to commit money laundering.
The U.S. Secret Service’s Global Investigative Operations Center led the investigation, with assistance from Homeland Security Investigations, U.S. Customs and Border Protection, the U.S. Department of State’s Diplomatic Security Service, Dominican National Police, and the U.S. Marshals Service.
Prosecutors said scammers targeted U.S. victims through unsolicited messages on social media, phone calls, texts, and dating platforms, luring them into fraudulent digital asset investments. Victims were misled into believing their investments were appreciating, when in reality the funds were stolen.
If you or someone you know is a victim of digital asset investment fraud, the Justice Department urges reporting to IC3.gov.
