Last defendants plead guilty in $65 million elder fraud and laundering ring, San Diego
Federal prosecutors in San Diego say the last of 25 defendants have admitted their crimes in a $65 million scheme that used scam call centers and mailed cash to defraud thousands of elderly victims.
The US Attorney's Office for the Southern District of California announced on 26 October 2026 that the last of 25 defendants in a $65 million fraud scheme targeting thousands of elderly victims had admitted their crimes. Haotian Zhang and Zetian Zhang pleaded guilty on the Friday before the announcement. According to the office, the 25 defendants, mostly Chinese nationals, were arrested in August 2025 after a nationwide takedown in California, New York, Texas and Michigan. Three charged defendants remain fugitives.
Prosecutors say the network worked with India-based scam call centers. Callers posed as tech support agents, government officials or bank employees and told victims to withdraw cash, hide it in packages and send it by express carrier to fictitious names. The packages went to short-term rental properties, which members rented in a hub-and-spoke pattern before moving to new locations.
According to the office, members of the conspiracy also laundered the proceeds of the fraud. The charges include conspiracy to commit mail and wire fraud and conspiracy to launder monetary instruments. Two defendants, Huajian Chen and Jianhao Gao, pleaded guilty to operating an unlicensed money transmitting business.
The investigation began in December 2020 after an elderly victim contacted an express mail carrier about cash sent by mail, and investigators found 11 packages containing about $135,000 in cash addressed to fake names at San Diego-area short-term rentals. Prosecutors say videos by YouTube "scambaiter" channels helped identify members of the network. Sentencing hearings are scheduled from November 2026 to February 2027.
Why it matters to AML professionals
Scams that tell victims to withdraw cash leave few electronic traces, so the bank teller and the branch alert are often the only chance to stop the loss. Sudden large cash withdrawals by older customers, especially when the customer seems coached or rushed, deserve a conversation and a review. Money service and payment businesses also need to watch for unlicensed operators moving scam proceeds.
Red flags in this case
- An older customer making unusual, large cash withdrawals and being vague or scripted about the reason
- A customer mentioning a tech support, government or bank caller who told them to move money
- Repeated cash deposits or transfers by people with no clear business purpose linked to short-term rental addresses
- Individuals sending or receiving funds for others without a money transmitter licence
If this landed in your queue
- Review the customer's withdrawal history for a sudden change in cash activity and check for a pattern across branches
- Contact the customer through known details and ask open questions about who asked them to move money
- Check linked parties and addresses for connections to other alerts or short-term rental properties
- File a suspicious activity report that describes the suspected elder fraud typology clearly
Key terms
- Scambaiter
- A person who engages scammers, often on video, to waste their time or expose them.
- Unlicensed money transmitting business
- Moving money for others as a business without the required state licence or federal registration, a federal crime in the US.
Interview angle
What would make you suspect that an older customer's cash withdrawal is linked to a scam?
Mention changes from normal behavior, urgency, coaching by a third party, and explain how you would speak with the customer and escalate.
Sources
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