A U.S. federal court has ordered cryptocurrency platform Debiex to pay $2.5 million after finding it guilty of a fraudulent scheme known as 'pig butchering'.
Details of the Scheme
According to the Commodity Futures Trading Commission (CFTC), from March 2022 onwards, Debiex's operators targeted individuals, primarily Asian Americans, through social media platforms. They established trust by posing as friends or romantic interests and persuaded victims to invest in Debiex's purported digital asset trading platform. The platform falsely presented itself as a legitimate trading venue, but in reality, no actual trading occurred. Instead, the funds were diverted to wallets controlled by the fraudsters.
Financial Impact
The fraudulent activities led to the theft of approximately $2.3 million from at least five victims. In response, Judge Douglas Rayes ordered Debiex to repay the stolen amount and imposed a civil penalty of nearly $221,500, totaling around $2.5 million in liabilities.
Role of Zhāng Chéng Yáng
The court identified Zhāng Chéng Yáng as a 'money mule' for Debiex, facilitating the transfer and concealment of the misappropriated funds. His digital asset wallet, associated with the exchange OKX, received assets to which he had no legitimate claim. The court ordered the confiscation of these assets, amounting to approximately $119,500, to be returned to the victims.
The Debiex case underscores the critical need for vigilance in the rapidly evolving cryptocurrency landscape. As digital asset investments become more mainstream, potential investors must exercise due diligence, remain skeptical of unsolicited investment opportunities, and be aware of the prevalence of sophisticated scams designed to exploit trust and familiarity.
