A U.S. District Court in California has issued a default judgment against Cunwen Zhu and his company, Justby International Auctions, finding them liable for a fraudulent “pig butchering” scheme targeting victims through romance and false investment opportunities. The Commodity Futures Trading Commission (CFTC) announced the judgment on December 20, 2023.
The court order, issued December 7, permanently bans Zhu and Justby from trading in CFTC regulated markets and registering with the agency. They are also required to pay a $4,000,000 civil monetary penalty and $1,352,843 in restitution to defrauded customers. This marks the CFTC’s first judgment related to this specific type of romance/“pig butchering” fraud.
From approximately April 2021 through March 2022, Zhu and Justby acted as “money mules,” soliciting and misappropriating approximately $1,352,843 from around 29 customers who believed they were investing in digital asset commodities and/or forex trading. Instead of legitimate trading, the funds were diverted for personal use and transferred to accounts controlled by other members of the fraudulent scheme.
The scheme, known as “Sha Zhu Pan” in some circles, involves building a false relationship with victims – often romantic – before convincing them to invest in sham trading platforms. The CFTC complaint, filed in June 2023, alleged a well-coordinated effort to defraud customers, providing them with fabricated trade records to maintain the illusion of active trading. No actual trading occurred on behalf of the victims.
In a parallel criminal case, Zhu was charged with one count of wire fraud in the Middle District of Florida on April 19, 2023 (United States of America v. Cunwen Zhu, Case No. 3:23-cr-66-BDJMCR).
The CFTC cautioned that victims may not fully recover their losses, as wrongdoers often lack sufficient funds or assets. The agency pledged to continue pursuing such cases and holding perpetrators accountable.
Source: CFTC.gov
Related Federal Cases
- Mazen Alzoubi, Deed Theft Scheme, California 2016 · Florida
- Julio Caro, $1.5M Theft Scheme, California 2024 · Florida
- Carlos Canjura, Mail Theft Scheme, California 2024 · Florida
- Patricia Ramona Vasquez, Bank and Identity Theft, California · Florida
- Jermila McCoy, ID Theft Scheme, California 2024 · Florida
MORE FEDERAL CRIME NEWS
US NewsUS NewsUS NewsUS News