The Shilin District Court on July 20 sentenced a fraud leader identified by surname Shih to 22 years in prison for orchestrating the Cointhink Technology cryptocurrency scam that defrauded 1,539 investors of more than $37.14 million (NT$1.2 billion). Prosecutors determined the fraud ring laundered $71.3 million in total volume via Tether's USDT tokens between January 2014 and April 2015, using fake credentials claiming authorization from Taiwan's Financial Supervisory Commission to lure victims into purchasing USDT with cash. The sentencing follows an indictment filed last August against 14 defendants by the Shih-chung District Prosecutors Office, which sought confiscation of all ill-gotten gains and originally recommended a 25-year prison term before the court settled on 22 years.
Cointhink Fraud Ring Used Fake Credentials and Gang Networks to Launder USDT
According to the investigation led by the Shilin District Prosecutors Office, the fraudulent group falsely advertised Cointhink Technology as "the only platform authorized by the Financial Supervisory Commission" in Taiwan. Operating with organized gang elements, the group channeled targets through fake investment groups where gang members guided victims to purchase tether tokens with physical cash, which was then systematically laundered. Prosecutors revealed the group converted the illicit cash into U.S. dollars and transferred it to offshore accounts to conceal the paper trail.
In a secondary layer of the scheme, victims were instructed to transfer their existing USDT tokens to designated digital cold wallets. The gang then moved the cryptocurrency through multiple layered transfers to create intentional "breakpoints," effectively blinding law enforcement tracking and hiding the origin of the proceeds. Data released by prosecutors showed that between January 2014 and April 2015, the syndicate managed a money laundering pipeline moving more than $71.3 million in total volume.
Shilin District Court Sentenced Shih to 22 Years with Asset Seizure Pending
Fourteen individuals in total were indicted in connection with the criminal operation on charges that included violating the Fraud Crime Prevention Act. The indictment against Shih and his 13 co-conspirators was filed last August by the Shih-chung District Prosecutors Office, which actively requested the total confiscation of all ill-gotten gains. Though prosecutors originally recommended a combined 25-year prison term, the Shilin District Court ultimately settled on the 22-year sentence. Shih can still appeal the verdict.
FAQ
What did the Shilin District Court sentence Shih to on July 20?
The Shilin District Court sentenced Shih to 22 years in prison for leading the Cointhink Technology fraud ring that defrauded 1,539 investors of more than $37.14 million (NT$1.2 billion) through a USDT-based cryptocurrency scam.
How did the Cointhink fraud ring launder money using USDT?
The fraud ring instructed victims to purchase USDT tokens with physical cash, which was converted to U.S. dollars and transferred to offshore accounts. Victims were also told to transfer existing USDT to designated cold wallets, after which the gang moved the cryptocurrency through multiple layered transfers to create "breakpoints" that concealed the origin of the funds from law enforcement.
How many people were indicted in the Cointhink fraud case?
Fourteen individuals were indicted in connection with the Cointhink fraud operation on charges including violating the Fraud Crime Prevention Act, with prosecutors seeking confiscation of all ill-gotten gains from the defendants.
