Victims in the fraud case involving 61,000 bitcoins and Chinese company Lantian Gerui may be eligible for extra compensation due to appreciation of the cryptocurrency and after significant progress in the UK court last month, but multiple legal challenges are pending in this cross-border case.
In 2014, Qian Zhimin, the actual controller of Tianjin-registered Lantian Gerui, conducted illegal fundraising by luring nearly 130,000 Chinese investors to invest RMB40.2 billion with promises of high returns. Qian converted the illicit funds into bitcoins and transferred them overseas in 2017. She later fled to the UK using a fake passport and was arrested in London in April 2024.
In September 2025, Qian pleaded guilty to two counts of possessing and transferring criminal proceeds through cryptocurrencies at Southwark Crown Court in London. The sentencing
hearing is expected in November, marking a critical stage in the cross-border recovery process.
Liu Yang
Liu Yang, a partner at DeHeng Law Offices, said the case differed significantly from traditional recovery cases due to the “non-physical” and “decentralised” nature of bitcoin, particularly in the settlement stage.
Some key issues in the case include: Should the UK authorities order the return of bitcoins or their equivalent value in fiat currency to the victims? If repayment is made in fiat currency, which jurisdiction should handle the disposal of the virtual assets? Who is entitled to value the appreciation, resulting from the rise in bitcoin prices?
Jack Ding, Duan & Duan Law Firm’s partner who acted as lead counsel for a group of victims, said that in addition to addressing the differing legalities on cryptocurrencies between China and the UK, another main challenge was handling state-level procedures suc
Jack Ding
h as the China-UK treaty on mutual legal assistance in criminal matters, and client matters like civil asset recovery procedures. His team also has to be mindful of the PRC law’s regulations on cases involving the public and sensitive matters.
“The extremely high cost of overseas legal services” poses a major challenge for Ding’s clients. To address this, his team introduced a leading international litigation funding institution to provide financial support.
When asked how to effectively pursue cross-border recovery, Ding advised companies to “first confirm whether the target actually has assets” before beginning. “If the target has foreign assets, we can use a wide range of international legal tools. If not, companies should refrain from acting rashly,” he said.
Ding added that companies should be prudent when hiring foreign legal counsel, and they must learn about the overseas billing arrangements to avoid unnecessary legal expenses.
He cited an example from this fraud case, in which a British law firm sent five or six solicitor advocates to attend a UK court hearing. “It is truly incomprehensible,” he said. “Typically, two solicitor advocates would suffice. I suspect this happened because foreign lawyers are not under the same ‘constraints’ as domestic ones and handle cases entirely on their own.”
The fraud case has received extensive international media coverage, and Ding said companies should acknowledge their importance. “Companies and their lawyers should learn how to work with international media in support of the case,” he said.
As for preventing internal staff from falling into illegal fundraising traps, Liu said companies should carefully examine counterparties and their business models before entering partnerships. They should also check the counterparty’s qualifications and sources of funds if the partnered project involves “digital currency” or “blockchain”. Companies should also be particularly vigilant and be aware of illegal fundraising features such as “guaranteed returns” or “public solicitation”.
Liu suggested that companies should establish clear internal rules to prohibit employees from participating in or assisting with virtual currency financing projects. “Many companies encounter trouble not because they intentionally violate the law,” he said, “but because employees personally participate and are then deemed ‘accomplices in illegal fundraising’, thereby implicating the company.”
If a company discovers suspected illegal fundraising, it should immediately terminate co-operation, preserve evidence and avoid commingling of funds. If already entangled in a case, the company should actively co-operate with judicial authorities and provide transaction details to prove its innocence, he added.
