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A US federal court has sentenced Daren Li, a dual citizen of China and St. Kitts and Nevis, to 20 years in prison for his role in laundering tens of millions of dollars tied to a global crypto investment scam — a “pig butchering” style operation that targeted victims through social engineering and fake trading platforms.
The unusual wrinkle: Li wasn’t in court. Both TRM Labs and the US Department of Justice say the sentence was imposed in absentia, after Li fled while awaiting sentencing.
What happened
TRM Labs reports Li pleaded guilty on Nov. 12, 2024 to conspiracy to commit money laundering, admitting he helped process roughly $74 million in scam proceeds.
The DOJ press release, dated Feb. 9, 2026, says Li was sentenced in the Central District of California to the statutory maximum 20 years in prison plus three years of supervised release, tied to an international crypto investment conspiracy run from scam centers in Cambodia.
How the scam pulled people in
According to TRM’s write-up of the filings, the fraud followed a classic pig-butchering playbook: scammers contacted victims via messaging apps like WhatsApp and Telegram, spent weeks or months building trust, then pushed them toward spoofed trading websites meant to look like real crypto platforms.
TRM cites one victim example from court documents: “Victim 1” reportedly sent about $1.5 million between May and August 2022 after being shown fabricated “profits,” then faced additional demands when trying to withdraw.
The laundering pipeline: shell companies, offshore accounts, USDT
The case is less about a single wallet hop and more about an industrial back office.
TRM says investigators identified 74 US-registered shell companies allegedly used to receive and move stolen funds, with nearly $60 million routed through those entities before being converted into crypto.
TRM also describes an offshore step: more than $35 million moved into a Bahamas-based account referenced in filings, where funds were converted into USDT. Separately, TRM says Li’s own crypto account received about $4.5 million in proceeds that were then forwarded onward.
Why the “fled before sentencing” detail matters
For enforcement, flight changes the game. TRM frames the case as a reminder that transnational defendants with dual citizenship and overseas infrastructure can be materially harder to hold in custody — even after a guilty plea.
The DOJ message is even more direct: it says Li became a fugitive after removing (or cutting off) an electronic monitoring device and absconding, and that US agencies and international partners are involved in the investigation and pursuit.
Why it matters for crypto
- “Pig butchering” is still scaling. This case shows how romance/relationship-driven crypto fraud can be run like a business, with dedicated laundering infrastructure.
- Stablecoins remain core settlement rails for criminals too. TRM’s account describes USDT conversion as part of the laundering flow.
- Shell companies are the choke point regulators keep targeting. The alleged use of dozens of US entities highlights why banking/KYC pressure is moving upstream, not just onchain.
- Enforcement outcomes depend on custody, not just tracing. Even with onchain visibility and a guilty plea, the case turned into an international fugitive hunt.
What to watch next
- Extradition and apprehension efforts. The DOJ says it will work with global partners to return Li to serve the sentence.
- Further cases tied to the same network. DOJ says eight co-conspirators have pleaded guilty so far, with Li the first sentenced who was directly involved in receiving victim funds.
- Asset seizure and forfeiture actions. Large scam cases often evolve into parallel forfeiture proceedings; watch for additional filings or seizure announcements tied to wallets and accounts.
- More pressure on scam-center infrastructure. DOJ explicitly frames this as part of a broader campaign against scam centers and their laundering networks.
What we don’t know yet
When exactly Li fled. TRM says he removed his monitor and fled in December 2024, while the DOJ says he absconded in December 2025.
Source: TRM Labs blog – Chinese National Sentenced to 20 Years for Laundering USD 74 Million in Crypto Scam Proceeds — Fled Before Sentencing