Chinese Fraudsters Jailed for Defrauding Indians of $6M in Crypto Investment Scam

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A local court in China recently sentenced nine Chinese fraudsters to prison terms over defrauding Indians of about $6 million through USDT fraud. Notably, the scheme involved using translation and chat software to befriend foreigners, gain their trust and trick them into investment by defrauding their money.

Over 66,000 Indians Fell To the Scam

The case handled by the People’s Court of Heze Economic Development Zone in Shandong Province involved a total of 517 million Indian rupees which is about 40 million RMB targeting 66,800 Indians. The nine fraudsters were sentenced to prison and fined for their involvement in the large-scale scam targeting Indians.

He Moutian was the mastermind behind the scam. In May 2023 he set up an office in Heze, China and formed a fraud gang with several other people. The group used overseas servers, appeared to be large investors, and targeted Indians through a fake investment platform called SENEE.

Scammers Promised 8%-15% Returns, Stole Millions for USDT Conversion

They pretended to be friendly investors on chat apps, offering high monthly returns of 8%-15% on smaller investments like 1,000 rupees. Once people put in larger sums of money, the gang would shut the platform and freeze the funds. The stolen money was then used to buy USDT through a third-party payment platform which was later converted into RMB or US dollars, with the group keeping 15% as profit.

Scammers Used Fake Identities and Coordinated Closely

One of the scammers, Li Mouwang, admitted to pretending to be a rich Indian woman who made money through smart investments. She used chat apps to build trust and fake relationships with Indian men and lured them into investing in the fake SENEE fund.

Furthermore, the gang also posted fake lifestyle photos like gym selfies and travel pics and also set their app location to Indian cities. A fake company website with edited licenses, registration certificates and business documents was also created to make the investment platform seem genuine and gain customer trust. The court found that the group was highly organised with clear roles and tight coordination. All the nine members were sentenced to 5 to nearly 15 years in prison and fined.

The Judge noted that although this case targeted foreigners, however online scams are common inside China too. It warned the public to not fall for promises of easy money, special insider tips or cashbacks for placing orders as they are all signs of scams. The authorities are increasingly cracking down on telecommunications network fraud and the judge has urged the fraudsters to surrender for lighter punishment.