Justice Department Disrupts Chinese Scam Network, Seizes Millions in Cryptocurrency
The Justice Department’s Scam Center Strike Force, in collaboration with the Treasury Department, has dismantled a Chinese-language scam marketplace known as Xinbi Guarantee, seizing approximately $52 million in cryptocurrency in a single day, U.S. Attorney Jeanine Pirro announced this week. This operation brings the total amount restrained by the Strike Force since its inception to roughly $938 million.
In a parallel effort, another Strike Force team assisted authorities in Madagascar in taking down 13 Chinese-operated scam compounds. This action significantly expands the reach of a crackdown initiated last November, which had previously been concentrated in Southeast Asia.
Xinbi operated primarily on the Telegram platform, using Chinese to facilitate its illicit activities. It functioned as a marketplace where vendors offered services to scam center operators, including the creation of fraudulent investment websites, the laundering of funds obtained through wire fraud, and the recruitment of trafficking victims to staff scam compounds.
Prosecutors explained that Xinbi held payments in escrow until a vendor completed their service. This mechanism allowed investigators to trace specific victim funds to vendors who had posted their cryptocurrency wallet addresses on the Telegram channel. A federal court in Washington authorized the seizure of these Telegram channels on September 7, with prosecutors unsealing the warrant on Wednesday.
Investigators seized two cryptocurrency wallets used by Xinbi to collect vendor payments, valued at approximately $12 million. They also sought the restraint of 47 additional wallets linked to the network, bringing the total value confiscated from the platform and its vendors to over $52 million.
On the same day, the Treasury’s Office of Foreign Asset Control (OFAC) designated Xinbi as a transnational criminal organization, along with two other entities accused of supporting its operations. This designation freezes any assets they may hold within the United States.
U.S. Attorney Pirro highlighted the broad impact of these scams, stating, “Every American with a retirement account is in the blast radius.” She added, “My Strike Force will continue to dismantle Chinese organized crime, those who facilitate it, and protect Main Street America.”
In conjunction with the Xinbi operation, U.S. Attorney Michael Heyman of Alaska noted that the Strike Force’s two-week deployment in Madagascar, which involved processing over 3,200 devices and interviewing approximately 400 arrested individuals, illustrates the evolving nature of this fight. “Transnational criminal organizations don’t care about borders, and the Department of Justice won’t either,” he remarked.
Earlier this year, the British government sanctioned Xinbi. Chainalysis estimated that the platform had processed nearly $20 billion in cryptocurrency between 2021 and 2025, offering a range of illicit goods and services, from stolen personal data to satellite equipment used to target fraud victims. However, this previous action had minimal impact, with the criminal group simply establishing new Telegram channels to continue its operations. The Scam Center Strike Force itself was established in November 2025 by Pirro to target Chinese organized crime involved in running scam centers.
Federal data released on Wednesday indicated that reported losses from cryptocurrency investment fraud reached $8.65 billion in 2025, an 89% increase from $4.57 billion in 2023. The FBI cautions that these figures are likely an underrepresentation, as many fraud victims do not report their losses.
