Federal judge hands down maximum sentence in massive cryptocurrency investment fraud tied to overseas scam centers.
More than $73 million in victim funds were laundered through U.S. shell companies and converted into digital assets.
Defendant Daren Li fled supervision prior to sentencing and remains a fugitive.
LOS ANGELES, CA (STL.News) A federal judge has sentenced a man to 20 years in prison for his role in a sweeping $73.6 million global cryptocurrency investment scam that targeted victims across the United States. The case highlights the growing threat of sophisticated online fraud operations that combine social engineering, fake investment platforms, and international money-laundering networks.
The sentence represents the statutory maximum allowed under federal law and underscores the seriousness of the crime. The defendant, identified in court filings as Daren Li, 42, a dual national of China and St. Kitts and Nevis, was convicted of conspiracy to commit money laundering tied to a complex international crypto fraud operation.
Authorities say Li is currently a fugitive after allegedly cutting off his ankle monitor and fleeing supervision prior to sentencing. The judge imposed the sentence in absentia and ordered three years of supervised release following imprisonment. Restitution to victims is expected to be determined at a later hearing.
Daren Li – How the $73 Million Crypto Scam Operated
According to federal prosecutors, the fraud scheme relied heavily on online manipulation and fake cryptocurrency investment platforms.
Investigators say overseas co-conspirators initiated contact with victims through:
- Social media platforms
- Text messages and unsolicited phone calls
- Online dating services
- Encrypted messaging apps
Victims were gradually persuaded to invest in what appeared to be legitimate cryptocurrency trading opportunities. Fraudsters built trust by forming romantic or professional relationships — a tactic commonly known as “pig butchering,” in which victims are emotionally groomed before being financially exploited.
Once trust was established, victims were directed to professionally designed spoofed websites that mimicked authentic crypto trading platforms. Victims were shown fabricated account balances showing large profits, encouraging them to invest more.
In reality, the funds were never invested. Instead, they were funneled into accounts controlled by the criminal network.
Daren Li – Shell Companies and Digital Asset Laundering
Federal authorities say the conspiracy used U.S.-based shell companies to receive and disguise stolen funds.
Court documents indicate:
- At least $73.6 million in fraud proceeds were deposited into accounts connected to the scheme.
- Nearly $60 million moved through shell companies specifically created to launder victim funds.
- Funds were transferred domestically and internationally before being converted into cryptocurrency.
Investigators say the money was eventually routed through overseas financial institutions and converted into digital assets such as USDT (Tether), making tracing and recovery more difficult.
Li admitted to directing others to open bank accounts in the United States for shell companies used in the laundering process. Prosecutors said he monitored transfers and oversaw the conversion of stolen funds into virtual currency.
Daren Li – Scam Centers and International Operations
Federal officials say the scheme was tied to organized scam centers operating overseas, including facilities in Cambodia. These centers are often structured like corporate offices, with employees trained to conduct long-term online deception campaigns targeting victims globally.
Authorities describe these operations as highly organized and technologically advanced, often using:
- Scripted investment pitches
- Real-time translation tools
- Encrypted communications
- Professional-grade website replicas
Law enforcement agencies have increasingly focused on dismantling these networks by seizing digital assets, freezing bank accounts, and coordinating with international partners.
Arrest and Guilty Plea
Daren Li was arrested in April 2024 at Hartsfield–Jackson Atlanta International Airport and later pleaded guilty to conspiracy to commit money laundering in federal court in Los Angeles.
Prosecutors indicated that multiple co-conspirators have also pleaded guilty in related cases, though Li is among the first to receive sentencing tied directly to the large-scale receipt and laundering of victim funds.
Authorities emphasized that investigations into the broader network remain ongoing.
Growing Crypto Fraud Threat Nationwide
Cryptocurrency investment scams have surged in recent years, becoming one of the largest categories of reported financial fraud in the United States.
Common red flags include:
- Unsolicited investment advice from strangers online
- Promises of guaranteed high returns
- Pressure to move conversations to encrypted messaging apps
- Requests to send funds to unfamiliar cryptocurrency wallets
- Difficulty withdrawing funds after “profits” appear
Federal agencies warn that once funds are converted into cryptocurrency and moved across borders, recovery becomes significantly more complicated.
Federal Response and Enforcement Efforts
The investigation involved multiple federal agencies, including financial crime specialists and international law enforcement partners. Officials say cases like this demonstrate the government’s commitment to targeting the financial infrastructure behind global fraud schemes.
Authorities have increasingly used digital forensics and blockchain analysis tools to track illicit cryptocurrency flows, seize wallets, and freeze assets connected to transnational criminal organizations.
Officials also encourage potential victims to report suspected crypto fraud to federal authorities through the FBI’s Internet Crime Complaint Center (IC3).
What This Means for Investors
The case serves as a stark warning about the dangers of online cryptocurrency investment opportunities promoted by unknown individuals.
Financial experts advise investors to:
- Verify platforms through official regulatory databases
- Avoid investment advice from strangers met online
- Be skeptical of guaranteed returns
- Confirm company registration and licensing
- Never share personal financial information with unverified contacts
While cryptocurrency remains a legitimate and growing asset class, regulators stress that its decentralized nature can also make it attractive to organized fraud networks.
A Maximum Sentence Sends a Message
The 20-year sentence signals that federal courts are prepared to impose severe penalties on those involved in large-scale digital asset fraud schemes. Although Li remains a fugitive, authorities say the sentence reinforces accountability within an expanding global crackdown on crypto-enabled financial crimes.
As digital assets continue to gain mainstream adoption, law enforcement agencies are prioritizing international cooperation to dismantle scam centers and money-laundering pipelines that exploit American investors.
The case stands as one of the more significant cryptocurrency-related fraud sentences in recent years and reflects the increasing seriousness with which federal prosecutors are approaching global digital asset scams.
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