Bangkok Arrest Exposes $31M Crypto Ponzi Scheme
Thai authorities arrested a Chinese nationwide in Bangkok regarding a cryptocurrency Ponzi scheme that defrauded almost 100 buyers of over $31 million.
The arrest marks a big improvement in a case that turned one among 2023’s largest decentralized finance exit scams.
How the Crypto Ponzi Scheme Operated
On Wednesday, Liang Ai-Bing, one among 5 suspects behind the FINTOCH platform, was apprehended at an upscale residence within the Wang Thonglang district following joint intelligence efforts between Thai and Chinese legislation enforcement.
The FINTOCH platform operated between December 2022 and May 2023, presenting itself as a respectable decentralized finance funding alternative. Operating beneath the model “Morgan DF Fintoch,” the scheme falsely claimed affiliation with funding banking large Morgan Stanley.
Morgan Stanley publicly denied any affiliation in 2023. The operation featured a fictional chief government named Bob Lambert, whose profile {photograph} was truly that of actor Mike Provenzano.
Investigators recognized the fraud as a five-person operation. Chinese authorities named the opposite alleged members Ai Qing-Hua, Wu Jiang-Yan, Tang Zhen-Que, and Zuo Lai-Jun. Zuo was arrested in China and launched on bail, whereas the remaining suspects fled. The platform promised buyers day by day returns of 1%, regardless of a warning from Singapore’s Monetary Authority in early May 2023.
Tracking the Crypto Ponzi Scheme Exit Scam
On-chain investigator ZachXBT was essential in exposing the fraud in May 2023, figuring out suspicious fund actions throughout a number of blockchain networks. The analyst’s findings revealed that the FINTOCH workforce withdrew $31.6 million in USDT from Binance Smart Chain, bridging funds to numerous addresses on Tron and Ethereum networks earlier than victims reported being unable to withdraw their investments.
Bug bounty platform Immunefi reported that the FINTOCH incident contributed to a 63% improve in cryptocurrency losses throughout Q2 2023 in comparison with the identical interval in 2022.
The arrest operation concerned a Criminal Court-issued search warrant at Liang’s residence, the place he had lived alone since late final yr. Officers found an unlawful firearm in the course of the raid, resulting in further costs of illegal entry into Thailand and illicit weapon possession. Liang had been paying roughly $4,645 month-to-month to hire the three-story property.
Cross-Border Enforcement Challenges
The FINTOCH case exemplifies advanced jurisdictional challenges in pursuing cryptocurrency fraud. International cooperation between Thai and Chinese police proved important in finding Liang, who had evaded detection for months by relocating throughout borders. Thai authorities are coordinating with Chinese counterparts to rearrange his extradition for fraud costs.
This incident displays broader developments in cryptocurrency-related crime. Earlier in October, US authorities introduced they have been in search of forfeiture of 127,271 BTC, valued at over $14.2 billion, from Chen Zhi, founding father of Cambodia-based Prince Holding Group, in a case involving pig butchering scams the place trafficked people operated fraudulent schemes beneath menace of violence.
The case raises questions on regulatory frameworks for decentralized finance platforms (DeFi platforms). Unlike conventional monetary establishments, DeFi platforms typically function throughout a number of jurisdictions concurrently, making efficient oversight troublesome.
Industry observers word that whereas blockchain transparency permits investigators to hint fund actions, the pace at which fraudulent operations launch and execute exit methods stays a persistent problem. The months-long hole between the May 2023 exit rip-off and October 2025 arrest illustrates the numerous time and sources required to pursue such instances internationally.
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