Father-Son Team in Taiwan Linked to Major Cryptocurrency Fraud
A father and son in Taiwan have been accused of running a significant cryptocurrency fraud scheme that reportedly laundered around 310 million New Taiwan dollars (approximately 93.96 million US dollars). The investigation led by the Yunlin District Prosecutor’s Office has resulted in the indictment of 17 people, including main suspects Zhou Hongwei and his father Zhou Funing.
Indictment and Criminal Operations
Announced on March 21, 2025, the indictment indicated that the Zhou family conspired with an international fraud syndicate to open ten cryptocurrency exchange stores in Taiwan, which served as a front for their illegal operations. Prosecutors revealed that these stores, which advertised anti-fraud protections, attracted unsuspecting individuals who, lacking knowledge about cryptocurrencies, invested large sums of money in exchange for Tether (USDT), only to have their funds swindled by the criminals.
Deceptive Strategies Employed
The defendants utilized a strategy they called “fake exchanges, real pawnshops,” creating an illusion of legitimacy to facilitate elaborate money laundering schemes. Zhou Hongwei and his associates guided victims throughout the process, leading to financial transfers that primarily benefitted the fraud ring.
Family Involvement in the Scheme
Over 18 months, authorities uncovered the Zhou family’s extensive involvement in the scam, revealing that multiple relatives, including Zhou Hongwei’s parents, brother, and girlfriend were all implicated. This broad involvement highlighted a systemic deception affecting the Taiwanese public.
Operational Tactics and Financial Gains
In their first operation year, the Zhou family established ten USDT exchange stores across Taiwan. They implemented strict victim control protocols, using forms to document interactions with potential victims and training employees on how to respond to law enforcement inquiries. This careful planning indicated the degree of premeditation behind their illegal enterprise.
Impact on Victims and Legal Consequences
The fraud’s scale was immense, with the Zhou family reportedly generating over 100 million New Taiwan dollars in profit within just a few months. Victims, many of whom lost their life savings, are estimated to number over a thousand across Taiwan. Prosecutors expressed grave concern over the harm caused, likening it to drug crimes, and argued for significant penalties for the offenders despite potentially lighter minimum sentences for aggravated fraud.
Raising Awareness and Future Prevention
This incident underscores the rising prevalence of cryptocurrency scams and the urgent need for enhanced public education on the risks associated with digital currencies. Authorities have called for caution and comprehensive research before anyone engages in cryptocurrency transactions, as the Zhou family’s case serves as a stark warning about the dangers of unguarded participation in the crypto market.
Ongoing Investigations
Investigators are currently working to trace the illicit funds generated through the Zhou family’s scheme, aiming to recover losses for victims. Coordinated efforts by local law enforcement and financial authorities are ongoing to ensure that those behind this fraudulent network are brought to justice. As the case progresses, there is a focus on ensuring accountability and providing restitution, while also seeking measures to prevent similar scams in the future.
