A Chinese national has been sentenced to 40 months in federal prison for participating in a money laundering scheme connected to cryptocurrency investment scams. The announcement was made by Jay R. Combs, U.S. Attorney for the Eastern District of Texas.
Fei Liao, 31, from San Gabriel, California, pleaded guilty to conspiracy to commit money laundering. In addition to his prison sentence, Liao was ordered by U.S. District Judge J. Campbell Barker on February 19, 2026, to forfeit over $2.3 million in seized currency and pay more than $2.8 million in restitution to victims whose funds were directed into his accounts.
Court records indicate that Liao and others set up shell companies and bank accounts as part of a plan to launder proceeds from so-called “pig butchering” scams—cryptocurrency fraud schemes where scammers contact victims through dating services, social media platforms, or unsolicited messages while posing as someone who dialed a wrong number. After building trust with their targets, the scammers suggest investments using cryptocurrency. These fraudulent platforms show fake gains on investments to encourage further deposits; ultimately, victims are unable to withdraw their money and experience substantial financial losses.
The investigation was led by the U.S. Secret Service’s Tyler Resident Office and prosecuted by Assistant U.S. Attorney Robert Austin Wells.
Authorities urge anyone who believes they may be a victim of such scams to report incidents at www.IC3.gov with reference “Pig Butchering PSA.” Victims are advised to provide details about investment platforms used, cryptocurrency addresses and transaction information, bank account data, suspected scammer identities and contacts, as well as copies of all communications and financial records.
