A conwoman behind a £5.1 billion bitcoin fraud has given police access to a further £67 million of cryptocurrency after a digital storage device was found hidden in her trousers.
Prosecutors announced on Wednesday that the seized cryptocurrency would be used to fund a compensation scheme for thousands of Chinese investors.
Qian Zhimin, known as the BitQueen, had agreed to forfeit all her cryptocurrency after pleading guilty last month to possessing and transferring criminal property, the High Court was told.
Qian Zhimin
METROPOLITAN POLICE
The initial £5.1 billion of bitcoin was seized after police raids on her home in Hampstead, north London, in 2018. Qian went on the run and was not arrested until she was found in York. Police discovered a digital device in a concealed pocket in the pair of jogging bottoms she was wearing, the court was told.
During interviews in prison with prosecutors and police last month she finally provided access codes for the device and passwords for two cryptocurrency wallets containing £67 million of bitcoin and another cryptocurrency, Ripple.
Qian’s maid, Jian Wen, who was jailed last year after being found guilty of money laundering, has agreed to forfeit £3.1 million of her assets.
Rachel Reeves, the chancellor, was reported to have earmarked the seized cryptocurrency to shore up the government’s finances. However, Stephen Parkinson, the director of public prosecutions, is setting up a compensation scheme for the victims which will be funded by cryptocurrency, the court was told.
It was not stated whether the estimated 128,000 victims would receive only their original investment, or the massive increase in the value of bitcoin. The cryptocurrency has increased in value from about £750 at the start of 2017, when Qian’s fraud unravelled, to a record £94,000 this month.
British lawyers representing more than 1,000 victims are seeking the current value. Lawyers representing thousands of victims say their lives were ruined by the collapse of Qian’s investment scheme — the Tianjin Lantian Gerui Electronic Technology Company, better known as Blue Sky.
William Glover, from the law firm Fieldfisher, said: “Some lost their life savings and many of them are elderly or vulnerable. The victims have been without their property for some ten years now and are entitled to recover their property from the bitcoin frozen in this jurisdiction.
“The frozen bitcoin does not belong to the UK state. The UK state does not have the right to freely dispose of the frozen bitcoin over victims’ legitimate legal and proprietary interests.”
Mr Justice Turner will make an order on the compensation scheme at a later date.