- Epoch Times CFO is embroiled in a multi-million dollar money laundering scandal.
- Associates committed crimes and used the proceeds to buy cryptocurrencies.
- Crypto crime remains a small percentage of all on-chain transactions.
The Epoch Times is a right-wing media organization known for its support of Donald Trump and its unwavering anti-Chinese Communist Party (CCP) stance. The organization is linked to the Falun Gong movement, a spiritual religious ideology based on chi or life force exercises. Reports claim that Falun Gong practitioners have been persecuted by the CCP, including imprisonment, torture, and organ harvesting.
While the Epoch Times group has garnered a substantial following for pushing views that clash with mainstream narratives, such as claims about the COVID-19 vaccine and 2020 presidential election fraud, it now finds itself embroiled in a fresh round of controversy as U.S. authorities charged the group’s CFO, Bill Guan, with money laundering offenses, including using crime proceeds for crypto purchases.
Epoch Times CFO Accused
According to the Department of Justice, Guan was charged with participating in a scheme to launder at least $67 million in illegally obtained funds. The indictment alleged that Guan managed a “Make Money Online” team that committed crimes, including fraudulently claiming unemployment benefits and using the proceeds to buy cryptocurrency.
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The criminal proceeds were purchased by scheme members using an unnamed cryptocurrency platform at discounted rates of between 70 and 80 cents on the dollar and in exchange for cryptocurrency. The funds were then transferred into accounts associated with the Epoch Times media company and related entities.
Scheme members are accused of using stolen ID to open various accounts, including prepaid debit card accounts, cryptocurrency accounts, and bank accounts, to enable the flow of funds into their own personal accounts.
The alleged scheme coincided with an extraordinary 410% increase in the Epoch Times Group’s annual revenue, growing from approximately $15 million to $62 million. When banks raised concerns about the increase, Guan is said to have lied, claiming the increase stemmed from an increase in donations to the organization.
The charges brought against Guan do not relate to the Epoch Times’ news-gathering activities. Nevertheless, he faces up to 70 years in prison if convicted on one count of conspiring to commit money laundering and two counts of bank fraud.
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The indictment against Guan adds to a mounting series of high-profile crypto-related cases that have drawn intense scrutiny to the sector. From the recent conviction of former Binance CEO Changpeng Zhao on money laundering charges to Michael Saylor’s $40 million settlement over tax evasion allegations, it is clear that authorities are intensifying their crackdown on illicit activity involving digital assets.
Crypto Crime Falls in 2023
A string of recent high-profile crypto crime cases saw MicroStrategy chair Michael Saylor pay a $40 million settlement with the District of Columbia attorney general, rather than have the case go to trial. Saylor was accused of dodging tax by claiming to live in Florida, a lower-tax state.
The prosecuting attorney general called Saylor out for breaking the law and robbing public services of vital funding. Despite the significance of the settlement neither MicroStrategy nor Saylor admit to any wrongdoing.
While authorities may view the digital asset industry as a cesspool of criminality, crypto crime in 2023 saw a notable decline. According to research conducted by Chainalysis, the total value received by illicit addresses fell to $24.2 billion, a significant drop from the $39.6 billion recorded in the previous year.
Although the most recent $24.2 billion figure may seem a significant amount, it still represented just 0.34% of all on-chain transaction volume for last year.
On the Flipside
- The allegations raise questions about the Epoch Times‘ funding sources and potential connections to larger networks or organizations.
- Regulators would maintain that AML and KYC rules protect individuals.
- Freedom advocates argue that AML and KYC rules are about control, not investor protection, including X influencer CR1337, who noted that the cost of compliance far exceeds the criminal funds confiscated.
Why This Matters
Critics would highlight cryptocurrency’s involvement in this case, advocating for stricter controls on digital assets. However, the proportion of crypto used in crime remains minuscule.
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