Three individuals, including two Chinese nationals, have been arrested for allegedly laundering over $13 million linked to an investment scam known as “pig butchering.”
The suspects—Mingzhi Li (24), also known as Zheng Lin, and Zeyue Jia (23), aka Jiao Jiao Liu, both from downtown Los Angeles, along with Jun Shi (55) from San Gabriel—were taken into custody and made their first court appearance in Santa Ana on Tuesday, according to the U.S. Department of Justice (DOJ).
How the Scam Worked
The “pig butchering” scam is a type of financial fraud where scammers build trust with victims, encouraging them to invest increasing amounts of money—often in cryptocurrency. The victims believe they’re making profitable investments, but in reality, the fraudsters disappear with the funds.
In this case, Jun Shi created two companies, Magic Location Trading LLC and Stone Water Trading LLC, in 2022. These businesses were supposed to handle money transfers, but they were never registered with the authorities as required by law.
Where Did the Money Go?
- Li and Jia opened bank accounts where funds from fraud victims were deposited through multiple wire transfers.
- Prosecutors say Stone Water Trading received $7.6 million, while Magic Location Trading took in $5.4 million.
- Instead of real investments, the money was transferred to other accounts, sent overseas, or used for personal expenses. Victims were misled into believing their funds were growing, as fake investment dashboards showed rising profits in gold contracts or cryptocurrency like Bitcoin.
Victims Lost Everything
One victim, a 72-year-old man from Minnesota, thought he was investing through an online platform called Enkuu. He transferred $75,000 to Stone Water Trading and later $250,000 to Magic Trading—only to realise he couldn’t withdraw any of his money.
Legal Action & Charges
- Li and Jia, who are both Chinese nationals, had entered the U.S. on student visas that have since expired. They are currently in custody without bail.
- Shi has been released on a $20,000 bond.
- All three face charges of operating an unlicensed money-transmitting business, a crime that carries a maximum penalty of five years in federal prison.
Their arraignment is set for March 17.
