Blab Crypto
U.S. Attorney Launches Strike Force to Shut Down Chinese-Linked Crypto Scam Network
On Wednesday, U.S. Attorney Jeanine Pirro of the District of Columbia announced the launch of the Scam Center Strike Force, a new enforcement unit aimed at dismantling Chinese‑linked fraud operations that target U.S. consumers.
The first major action of the strike force was the seizure of Xinbi Guarantee, a Chinese‑language marketplace that operates on Telegram. A Justice Department statement said the channel had more than 650,000 users and offered services such as building custom scam investment websites, laundering cryptocurrency proceeds, and recruiting workers for scam compounds in Southeast Asia.
In a coordinated effort that included the Treasury Department, authorities froze $52.8 million in cryptocurrency linked to Xinbi and its merchant network. The Treasury’s sanctions list now names Xinbi and 28 other individuals and companies identified as operating from Cambodia and other countries.
The DOJ said the crackdown is part of a broader effort to recover billions of dollars in fraud losses. The strike force has already restrained approximately $938 million in crypto assets in total, including the $52 million seized in a single day. Treasury officials estimate that Xinbi processed about $24 billion in transactions.
Beyond the online marketplace, the strike force has taken action against physical scam compounds. A U.S. team spent two weeks in Madagascar working with local authorities to dismantle 13 scam centers allegedly run by Chinese organized‑crime syndicates. The DOJ described the operation as a “decisive action to dismantle illicit networks targeting innocent victims.”
Pirro, appointed U.S. Attorney in May 2025, emphasized that the strike force’s goal is to protect “Main Street America” from fraud that often targets elderly and vulnerable consumers. She highlighted the removal of illicit marketplaces, freezing of crypto assets, imposition of sanctions, and dismantling of scam compounds.
The crackdown has drawn attention from the broader crypto‑regulatory community. The Treasury’s sanctions on Xinbi mark the first time the U.S. has targeted a Telegram‑based marketplace for facilitating cryptocurrency fraud. The DOJ’s statement underscored that the marketplace’s services enabled scammers to launder money, create fake investment sites, and recruit trafficked workers.
The operation also illustrates the international dimension of crypto‑related fraud. While U.S. authorities seized assets and imposed sanctions, the underlying criminal networks span China, Cambodia, Madagascar, and other Southeast Asian countries. The DOJ stressed the need for cross‑border cooperation to disrupt these networks.
The strike force’s actions arrive amid a broader U.S. effort to address fraud in the digital‑asset space. The Treasury Department has expanded its sanctions regime to target individuals and entities that facilitate money laundering and illicit finance. The DOJ’s focus on scam compounds and online marketplaces reflects a shift toward targeting the infrastructure that supports large‑scale fraud.
At present, the DOJ has not announced any arrests linked to the Xinbi marketplace or the Madagascar compounds. The Treasury’s sanctions list includes several key operators. The DOJ indicated that the strike force will continue to pursue additional cases and expand its reach to other regions.
The crackdown demonstrates the U.S. government’s willingness to combine seizures, sanctions, and international cooperation to combat crypto‑based fraud. The outcome of these actions will likely influence how other jurisdictions approach the regulation of digital‑asset marketplaces and the protection of consumers from sophisticated online scams.
The DOJ and Treasury are expected to release further updates as investigations progress. The crypto community will be watching closely to see how these enforcement actions affect the broader ecosystem, particularly the use of Telegram and other messaging platforms for illicit activities.
In summary, the Scam Center Strike Force has taken significant steps to disrupt a Chinese‑linked crypto scam network, seizing millions of dollars in cryptocurrency, imposing sanctions on key actors, and dismantling physical scam compounds in Madagascar. The operation underscores the growing focus of U.S. law enforcement on the intersection of cryptocurrency, money laundering, and organized crime.
The first major action of the strike force was the seizure of Xinbi Guarantee, a Chinese‑language marketplace that operates on Telegram. A Justice Department statement said the channel had more than 650,000 users and offered services such as building custom scam investment websites, laundering cryptocurrency proceeds, and recruiting workers for scam compounds in Southeast Asia.
In a coordinated effort that included the Treasury Department, authorities froze $52.8 million in cryptocurrency linked to Xinbi and its merchant network. The Treasury’s sanctions list now names Xinbi and 28 other individuals and companies identified as operating from Cambodia and other countries.
The DOJ said the crackdown is part of a broader effort to recover billions of dollars in fraud losses. The strike force has already restrained approximately $938 million in crypto assets in total, including the $52 million seized in a single day. Treasury officials estimate that Xinbi processed about $24 billion in transactions.
Beyond the online marketplace, the strike force has taken action against physical scam compounds. A U.S. team spent two weeks in Madagascar working with local authorities to dismantle 13 scam centers allegedly run by Chinese organized‑crime syndicates. The DOJ described the operation as a “decisive action to dismantle illicit networks targeting innocent victims.”
Pirro, appointed U.S. Attorney in May 2025, emphasized that the strike force’s goal is to protect “Main Street America” from fraud that often targets elderly and vulnerable consumers. She highlighted the removal of illicit marketplaces, freezing of crypto assets, imposition of sanctions, and dismantling of scam compounds.
The crackdown has drawn attention from the broader crypto‑regulatory community. The Treasury’s sanctions on Xinbi mark the first time the U.S. has targeted a Telegram‑based marketplace for facilitating cryptocurrency fraud. The DOJ’s statement underscored that the marketplace’s services enabled scammers to launder money, create fake investment sites, and recruit trafficked workers.
The operation also illustrates the international dimension of crypto‑related fraud. While U.S. authorities seized assets and imposed sanctions, the underlying criminal networks span China, Cambodia, Madagascar, and other Southeast Asian countries. The DOJ stressed the need for cross‑border cooperation to disrupt these networks.
The strike force’s actions arrive amid a broader U.S. effort to address fraud in the digital‑asset space. The Treasury Department has expanded its sanctions regime to target individuals and entities that facilitate money laundering and illicit finance. The DOJ’s focus on scam compounds and online marketplaces reflects a shift toward targeting the infrastructure that supports large‑scale fraud.
At present, the DOJ has not announced any arrests linked to the Xinbi marketplace or the Madagascar compounds. The Treasury’s sanctions list includes several key operators. The DOJ indicated that the strike force will continue to pursue additional cases and expand its reach to other regions.
The crackdown demonstrates the U.S. government’s willingness to combine seizures, sanctions, and international cooperation to combat crypto‑based fraud. The outcome of these actions will likely influence how other jurisdictions approach the regulation of digital‑asset marketplaces and the protection of consumers from sophisticated online scams.
The DOJ and Treasury are expected to release further updates as investigations progress. The crypto community will be watching closely to see how these enforcement actions affect the broader ecosystem, particularly the use of Telegram and other messaging platforms for illicit activities.
In summary, the Scam Center Strike Force has taken significant steps to disrupt a Chinese‑linked crypto scam network, seizing millions of dollars in cryptocurrency, imposing sanctions on key actors, and dismantling physical scam compounds in Madagascar. The operation underscores the growing focus of U.S. law enforcement on the intersection of cryptocurrency, money laundering, and organized crime.
