Chinese fraud victims challenge UK redress plan for 61,000 seized Bitcoin: FT

Chinese investors defrauded in the Zhimin Qian case are asking the UK High Court to reject a redress plan for 61,000 seized Bitcoin, saying it could deprive them of the assets’ gains.

Victims of a Chinese investment fraud are challenging a United Kingdom proposal to compensate them through a Chinese redress scheme, arguing the plan could leave British authorities holding much of the upside from roughly 61,000 Bitcoin seized in a money-laundering investigation.

According to the Financial Times, citing court documents, the dispute has moved into the UK High Court as groups representing victims seek to recover funds linked to the cryptocurrency seized by police in London. The Bitcoin (BTC) haul is now worth about 3.2 billion pounds ($4.3 billion) after rising sharply in value since the assets were confiscated.

Law firm Candey, which represents about 5,700 victims, said the proposed compensation arrangement may not guarantee fair restitution. The fraud scheme itself reportedly affected more than 128,000 investors in China, according to court documents cited by the FT.

The case highlights growing legal questions around crypto seizures, where digital assets can appreciate significantly between confiscation and restitution. The dispute stems from a Chinese investment fraud scheme that ran between 2014 and 2017 and defrauded investors before proceeds were converted into BTC and moved abroad.

Prosecutors reportedly argued that some of the legal claims could allow a subset of victims and litigation funders to recover sums exceeding their actual losses.

Martin Evans KC, representing the Director of Public Prosecutions, said in court submissions that the claims risk benefiting “a small subset of victims and their litigation funders” while excluding other victims and the Crown, according to the FT.

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Candey defended the legal action, saying court proceedings give victims the best chance of securing proper compensation and noting that its legal fees are capped at 18% of any recovered funds.

A preliminary hearing is scheduled for July to determine whether English or Chinese law should govern the claims to the seized Bitcoin. The High Court has also set a May 22 deadline for claimants seeking recovery under Section 281.

British authorities seized more than 61,000 BTC during a 2018 raid on a London property linked to Jian Wen, who was later convicted of money laundering, and Zhimin Qian, the mastermind of the scheme, who was sentenced by a UK court to over 11 years in prison in November 2025.

Wen attracted attention after attempting to buy a luxury London mansion using Bitcoin and failing to explain the origin of the funds.

In 2024, victims of the scheme sought assistance from Chinese authorities to recover the seized Bitcoin.

The seized Bitcoin has also drawn policy attention in Britain, with reports in 2025 that officials were exploring how and when such holdings could be sold.

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Source: CoinTelegraph