DOJ Seizes $15 Billion in Bitcoin in Cryptocurrency Fraud Scheme

DOJ Seizes $15 Billion in Bitcoin in Cryptocurrency Fraud Scheme

The US Department of Justice (DOJ) unsealed an indictment charging Cambodian national Chen Zhi, founder and chairman of Prince Holding Group, with wire fraud conspiracy and money laundering conspiracy. Zhi is charged with orchestrating cryptocurrency investment fraud schemes, known as “pig butchering,” from forced labor compounds in Cambodia. In a parallel action, the US Attorney’s Office for the Eastern District of New York and the DOJ filed a civil forfeiture complaint for about 127,271 Bitcoin or ~$15 billion — the largest forfeiture action in DOJ history — alleged to be proceeds and tools of Zhi’s schemes, which are now in US government custody. Zhi remains at large.

According to the allegations, Prince Group operated prison‑like compounds where trafficked workers, under threats and violence, executed large‑scale online investment fraud targeting victims worldwide, including those in the United States. The enterprise allegedly used sophisticated cryptocurrency laundering techniques called “spraying” and “funneling” to obscure sources of funds and move assets through cryptocurrency exchanges and bank accounts. According to the indictment, Zhi and his coconspirators spent proceeds on luxury goods such as yachts, jets, and artwork, and were able to hide their operations through political connections and bribery.

If convicted, Zhi faces up to 40 years in prison. In coordination with the DOJ action, the US Department of Treasury designated Prince Group as a transnational criminal organization and imposed sanctions on Zhi and associated individuals and entities. The United Kingdom also announced sanctions.

The Federal Bureau of Investigation’s (FBI) New York Joint Asian Criminal Enterprise Task Force and the FBI’s Virtual Asset Unit are leading the investigation.

Investor Suit Targets aTyr After Drug Trial Failure

On October 9, a proposed shareholder class action suit was filed against aTyr Pharma Inc. and CEO Sanjay Shukla for allegedly misleading investors about the likelihood of success for Efzofitimod, a treatment for pulmonary sarcoidosis.

The complaint, filed by investor Marco Munguia, alleges that beginning January 16, the company repeatedly highlighted full enrollment, patient benefits, and positive expectations, before announcing, on September 15, that the Phase 3 trial failed to meet primary endpoints and showed only minor differences from placebo. The complaint also alleged that Shukla and aTyr concealed material risks and adverse effects of the drug.

Following the September announcement, analysts reacted negatively and aTyr’s share price fell by about 83%. The complaint also alleges that RBC Capital Markets cut their price target for aTyr from $1.50 to $16.00. In the complaint, Shukla and aTyr are accused of violating the Exchange Act, and Munguia argues the defendants’ statements are not protected by the securities laws’ safe harbor because they lacked meaningful cautionary language.

The case is Munguia v. aTyr Pharma Inc. et al., No. 3:25-cv-02681 (S.D. Cal. 2025).

Aetna Agrees to Pay Class Members After Denying Spinal Surgery Coverage

On October 8, Aetna agreed to pay $55,000 per class member in a proposed settlement for coverage denials of lumbar artificial disk replacement (L-ADR) surgery coverage. Class members will receive reimbursements for out-of-pocket costs upon proof of surgery and payment. The settlement also provides prospective coverage for future L-ADR procedures for current Aetna enrollees with a surgeon’s medical-necessity certification.

The payouts for the 381 identified class members could total $8.5 million if all eligible members claim the full amount. 200 additional class members who had pre-authorization requests denied from Aetna and paid for their surgery out of pocket could also be entitled to receive up to $55,000.

The case, filed in 2019 and certified in 2021, alleged Aetna’s categorical denial of L-ADR as “experimental or investigational” violated plan terms. After a prior settlement attempt collapsed, the parties reported a new agreement in May, weeks before the June 30 trial date. The plaintiffs now seek preliminary approval of the settlement and indicated plans to request about $2.5 million in attorney fees and $17,000 service awards for the two class representatives.

The case is Brian Hendricks et al. v. Aetna Life Insurance Company, No. 2:19-cv-06840 (C.D. Cal. 2019).

Sixth Circuit Shuts Down Allergy Tester’s Antitrust Revival

The Sixth Circuit affirmed dismissal of United Biologics’, d.b.a. United Allergy Services, antitrust claims against Amerigroup Tennessee, and others, holding that the US Supreme Court’s Illinois Brick v. Illinois direct-purchaser rule bars the suit. The panel concluded that any alleged conspiracy to fix reimbursement rates and to deny claims directly harmed primary-care physicians, who billed insurers, resulting in underpayment. They also concluded that United Allergy was only indirectly harmed when doctors stopped paying its fees and ended their relationship with United. The court emphasized the risk of duplicative recoveries if both physicians and United Allergy could seek payment for the same claim. It likewise affirmed dismissal of United Allergy’s state-law claims, finding Amerigroup had legal justification to audit and deny claims, and the allegations against the allergy center relied on a speculative, multi-step causation chain.

A concurring judge stated precedent required dismissal but warned the outcome may harm consumer welfare. He noted the complaint plausibly alleged that insurers and a dominant allergy center pushed a more efficient provider out of an undersupplied market, imposing on patients longer travel, higher costs, or foregoing treatment altogether. Relatedly, BlueCross Blue Shield of Tennessee and BlueCare Tennessee previously settled their undercharge cases, and similar claims brought by United Allergy in other states have faced setbacks — including a Louisiana case which was dismissed in 2023 and is now on appeal to the Fifth Circuit.

The case is Academy of Allergy & Asthma v. Amerigroup Tennessee Inc. et al., No. 24-5153 (6th Cir. 2025).