'Glorified secretary' jails for facilitating crypto Ponzi scheme that cheated victims of millions

Chen Wei, 43, was recently sentenced to four years in jail and fined $6,000 for his involvement in a cryptocurrency investment scam that defrauded victims of $1.1 million. The Chinese national, who played a key role in the scheme, pleaded guilty to six cheating charges and one charge of operating without a valid work permit. An additional eight charges were considered during sentencing. If he fails to pay the fine, Chen will face an additional 20 days in jail.

Chen was the director of A&A Blockchain Technology Innovation, a company that offered a fraudulent investment scheme under the direction of its chairman, Dutch national Yang Bin.

Million-dollar Ponzi scheme

A&A Blockchain Technology Innovation was established in April 2021 and began offering its scheme to investors shortly after.

In its promotional materials, A&A claimed to have secured a deal with another company to acquire 70% ownership of 300,000 cryptocurrency mining machines located in Yunnan, China. These machines were supposedly capable of mining cryptocurrencies like Bitcoin and Ethereum.

In reality, none of these claims were true. To support its deception, A&A created an app that allowed investors to purchase "tokens" for the mining scheme and monitor their supposed daily returns of 0.5%.

Chen had access to the app's backend system, enabling him to authorize the withdrawal of Tether (USDT) stablecoins for investors, but only after Yang gave approval. This ability to withdraw funds helped maintain the illusion that the scheme was generating profits.

Yang, the mastermind behind the operation, was sentenced to six years in prison and fined $16,000 in August after pleading guilty to six charges of cheating and two related to the illegal employment of foreigners. Another 11 charges were considered during his sentencing.

Another co-accused, Wang Xinghong - A&A's chief technological officer - was sentenced on August 6 this year to a jail term of five years.

During Chen’s sentencing on September 11, his lawyer, Gary Low, described his role as primarily administrative, portraying him as a "glorified secretary" who followed Yang's instructions. However, Deputy Public Prosecutor Wong Shiau Yin highlighted that Chen’s role in collecting funds from investors made him an integral part of the fraudulent operation. Each count of cheating carries a potential sentence of up to 10 years in prison and a fine.