China extradites $14B crypto fraud suspect under Thailand treaty

A suspect named Zhang has been extradited from Thailand to China, marking the first financial criminal extradited under the China-Thailand treaty since its establishment in 1999.

Zhang, identified by the South China Morning Post as Zhang Yufa, also known as Tedy Teow Wooi Huat, is accused of orchestrating a massive $14 billion crypto pyramid scheme.

The Chinese Ministry of Public Security announced that a joint task force, dubbed "Hunting Fox," was created by Chinese and Thai officials to facilitate Zhang’s return to China.

Zhang, the founder of MBI Group, is alleged to have led a scheme that defrauded millions of investors, mainly Chinese nationals, by convincing them to invest in MBI’s unauthorised cryptocurrency.

The scheme reportedly attracted over 10 million members with promises of substantial returns, with fees ranging from 700 yuan ($98) to 245,000 yuan ($34,300).

The investigation into Zhang's activities began in Chongqing, southwest China, in late 2020.

Following this, Interpol's China Bureau issued an international arrest warrant, leading to Zhang’s apprehension by Thai police in July 2022 after he fled Malaysia.

China’s request for his extradition was approved by a Thai court in May 2024 and later upheld by the Thai government.

Malaysia had also sought Zhang’s extradition for fraud, but their request was secondary to China’s.

Chinese authorities have labeled Zhang's case as "extraordinary" and hope that his extradition will set a precedent for future international cooperation on extraditions involving financial crimes.

This case is part of China's broader crackdown on cryptocurrency-related activities, which intensified in 2021.

The government has implemented strict regulations, banning financial firms from processing crypto payments and limiting blockchain-related fundraising.

Despite these measures, crypto trading persists in China, with citizens finding ways to circumvent the restrictions.

China has also officially recognised virtual asset transactions as a form of money laundering, marking the first time the country has specifically targeted this asset class under its anti-money laundering laws.