A recent court ruling in China has resulted in the conviction of nine individuals for orchestrating a widespread telecommunications fraud network that targeted over 66,800 victims in India. The elaborate scheme, which operated between June 2023 and January 2024, managed to steal approximately ₹517 million, equivalent to $6.2 million, by utilizing fake investment platforms, manipulated online identities, and the promise of romance.
The mastermind behind the operation, known only by the surname He, established an office in Heze, Shandong Province, in May 2023 to launch what would become a highly organized and sophisticated scam. He assembled a team of scammers, rented overseas servers to conceal their digital footprint, and served as the primary liaison between the group and Indian companies. He was responsible for overseeing funds and facilitating money laundering through intricate cryptocurrency conversion channels.
The fraudulent enterprise operated under the guise of a fictitious investment platform called SENEE, which offered unrealistically high monthly returns ranging from 8% to 15% on deposits as low as ₹1,000 (~$12). The victims, predominantly Indian men, were contacted through popular chat and social media platforms by fictitious female personas posing as affluent Indian women with successful investment backgrounds.
To create an illusion of legitimacy, the fraudsters meticulously crafted online personas featuring geo-tagged photos of Indian cities, curated lifestyle content, and compelling personal narratives. Once the victims deposited funds that exceeded the promised returns, the scammers swiftly shut down the platform or converted the funds into equity, effectively locking away the money and freezing user access.
The illicit proceeds were laundered through third-party platforms and converted into Tether’s USDT, a stablecoin renowned for its global liquidity. Subsequently, the USDT was exchanged for Chinese yuan or U.S. dollars, with the criminal group reportedly pocketing a 15% commission from each transaction.
Described by the Chinese court as a “professional criminal syndicate” with clearly delineated roles, a profit-sharing system, and advanced operational security, the perpetrators were handed prison sentences ranging from five to nearly fifteen years, along with financial penalties. Presiding judge Liu Xilei emphasized China’s heightened efforts to combat telecom and online fraud and urged offenders to surrender voluntarily.
This case is emblematic of a broader transnational trend, as evidenced by similar fraudulent activities in neighboring Southeast Asia. In March 2024, Thai authorities apprehended two Chinese nationals, Wu Di and Zhou Zongyon, in Pattaya, Thailand, for engaging in a parallel cryptocurrency scam and kidnapping operation. Wu, posing as an amiable investor on social media, orchestrated a crypto scheme that defrauded victims of over 600 million baht ($17.7 million) within two months, mirroring the modus operandi of the SENEE model.
The crackdown on these criminal activities underscores the evolving landscape of cybercrime, which leverages cryptocurrencies for fraudulent purposes and money laundering, often intersecting with human trafficking, identity theft, and cyber manipulation. Despite the recent arrests and asset seizures, law enforcement acknowledges that they have only scratched the surface of a larger, more intricate network operating across Asia.