Author: Ryan S. Gladwin

Translated by: Tim, PANews

PANews Editor's Note: This article mainly focuses on the handling of funds involved in the illegal fundraising case of Blue Sky Ge Rui. It is reported that Qian Zhimin raised over 40.2 billion yuan across 31 provinces and cities in China through Blue Sky Ge Rui. The Hedong Branch of the Tianjin Public Security Bureau officially filed a case for investigation on April 21, 2017. However, at that time, Qian Zhimin had already foreseen the risks and fled to the UK. In late April 2024, Qian Zhimin was arrested by the UK police for money laundering.

Article Summary

• Qian Zhimin defrauded over 128,000 people through a fake investment scheme, stealing $6.8 billion and converting it into Bitcoin.
• The UK government seized these funds between 2018 and 2021, during which time the money had entered the UK, and discussions are currently ongoing regarding the disposal of the funds.
• Prosecutors are considering establishing a victim compensation plan, but an expert warns that the UK government may still retain the confiscated Bitcoin.
• Although the UK government previously stated its intention to retain most of the funds, prosecutors still plan to return funds to Chinese victims of a nearly $7 billion Bitcoin fraud case.

In September 2024, Chinese citizen Qian Zhimin admitted to obtaining and holding criminal proceeds worth $6.8 billion in Bitcoin and other assets. Between 2014 and 2017, Qian Zhimin illegally obtained these funds from over 128,000 investors in China through investment scams. For years, she converted the illicit funds into Bitcoin and attempted to launder the money. After Qian Zhimin fled to the UK using false documents, the Metropolitan Police seized this batch of stolen Bitcoin between 2018 and 2021.

In recent weeks, questions have arisen regarding how the UK government plans to handle its nearly $7 billion Bitcoin reserve. For example, Germany sold billions of dollars worth of Bitcoin last year, which had been seized in various cases. According to data from Arkham Intelligence, the US government currently holds seized assets worth $37 billion, and lawmakers intend to use this to establish a strategic reserve for crypto assets.

According to Bloomberg, prosecutors, who initially indicated plans to retain most of the Bitcoin, announced today in a court hearing that they intend to develop a victim compensation plan. It is reported that several investors have submitted claims for fund recovery to the court.

William Glover, a lawyer hired by the investor group, told Bloomberg at the hearing that some investors "have suffered tremendous personal losses, including in their lives, marriages, families, and careers."

Prosecutors have not provided specific details about the compensation plan. Jackson Ng, a lawyer representing a group of investors, told Bloomberg, "Given the unprecedented scale of the confiscated assets and the public debate over potential surpluses, our position is clear: compensation for victims must be prioritized."

However, Nick Harris, CEO of the UK cryptocurrency asset recovery company CryptoCare, warned that victims may be disappointed with the final outcome.

Harris told Decrypt, "Under the Proceeds of Crime Act, the UK may still retain the confiscated Bitcoin rather than directly redistribute it."

He stated, "Generally speaking, confiscated assets flow into the treasury or the budgets of law enforcement agencies through asset recovery reward programs. The US and Australia have also adopted this system, and these countries do not always prioritize victim compensation."

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