The world’s biggest cryptocurrency seizure could leave each taxpayer more than £1,000 better off by the next Budget, MailOnline can reveal.
Wealthy tycoons are believed to be shaking in their boots at the thought Britain could sell £4.5billion of Bitcoin that police nabbed in a money laundering sting.
Keen-eyed officers from the Metropolitan Police swooped on 42-year-old Chinese takeaway worker Jian Wen’s six-bed Hampstead Heath mansion in 2018 after she splurged tens of thousands on diamonds and luxury homes.
Amazingly, among piles of cash stashed away in the £17,000-a-month rental pad, officers discovered a digital wallet with 61,000 Bitcoin on it – the equivalent of £4.5billion.
It was the largest crypto bust in history.
Jian Wen, 42, (pictured) was found with a stash Bitcoin worth £4.5billion. She was convicted of money laundering and jailed for more than six years
She used to live in the flat above this Chinese Takeaway in Leeds. Like countless other migrants, she ended up working in the fast food industry
She then moved to London and worked at Hot Wok, in Abbey Wood, southeast London, below which she lived in a basement bedsit
Yet within weeks of meeting ‘supervillain’ Yadi Zhang, also known as Zhimin Qian, she moved into this fabulous six-bedroom house in Hampstead Heath, paying £17,000 a month in rent
It was only when the single mother tried to buy this £23million Hampstead mansion that alarm bells started ringing
Piles of cash were found by police during searches of her home – but the cherry on the cake for the Metropolitan Police was discovering the biggest cryptocurrency haul in the world of £4.5billion
HMRC data shows there are an estimated 37.4 million taxpayers in the UK. If the £4.5billion was split between them, every taxpayer would be £1,203 better off.
This year, Wen was sentenced to six years and eight months in jail for money laundering in relation to 150 Bitcoins (£8million) of the total found. Her ‘supervillain’ pal Yadi Zhang, also known as Zhimin Qian, ‘went on the run’ for six years but was caught in April and charged with money laundering, which she denies.
Even so, most people’s eyes remain on the money. The Government may be hoping it can pour the cash into the public purse.
After all, Chancellor Rachel Reeves has warned of a ‘£22bn black hole’ in public finances, which she has tried to counteract with a £40bn ‘tax bomb’ in the latest Budget.
But foreign tycoons are also circling.
The decision of who gets to keep the total sum of money is the High Court’s, which will decide in the next few months whether all of the £4.5bn will be deemed the proceeds of crime (meaning the UK can keep the money); if it must be returned to ‘Chinese investors’; or whether the Bitcoin should be ‘destroyed’ by erasing the key necessary to access the funds to stop the crypto they sell being used for further nefarious activity.
James Ramsden KC, one of the leading voices on crypto and digital asset litigation and a founding partner at law firm Astraea, believes the only sensible option is to sell it and put the money into the country’s pockets.
He told MailOnline: ‘If you have gold bullion that you seized from drug dealers, then you sell it and what the [buyers] do is up to them.
‘There’s no difference between crypto assets and tangible assets.
‘Most people think the money came from [around 128,000] wealthy Chinese investors who used Jian Wen and Yadi Zhang to bring their wealth to London.
‘We are gearing up for an interesting decision. Victims can apply to the court and say, ”That’s my asset and I would like it back.”’
However, as owning crypto is illegal in China, Ramsden said he thought it was unlikely any Chinese investors would claim their share.
Chancellor Rachel Reeves has warned of a £22billion black hole in public finances
Selling the 61,000 Bitcoins seized by the Met Police would leave the country £4.5billion richer, meaning taxpayers could each have more than £1,000 more in their pockets by the next Budget
The revelation comes after Labour launched a £40billion ‘tax bomb’ in its first Budget
He said: ‘I think the chance of anyone turning up at the High Court is pretty slim, which is absolutely phenomenal considering the amount.
‘I just don’t think they are going to put up their hands and say, ”That’s mine.”
‘If the court rules it’s the proceeds of crime, then the ”Chinese victims” won’t get it anyway.
‘The Government can either ‘realise’ it (sell it) or if contrary to the public interest, they can order its destruction. So far, that’s what law enforcement has done.’
Yet those destruction orders were for much smaller sums of around £100,000 and £1million.
This £4.5bn haul could make a dent in Labour’s ‘£22bn public finances black hole’.
Ramsden added: ‘I think [the UK] will find a way of [selling] it. I can’t believe the Government will turn their face away from £4.5bn.
‘That goes quite a long way to cover the big black hole.’
Solving the country’s financial turmoil with money seized from a ex-takeaway-worker-turned-‘Bitcoin-Queen’ might be seen as slightly peculiar.
However, it may still not be as strange as the story of the ‘Bitcoin Queen’ herself.
Wen jetted across Europe, including to Germany. She denied knowing she was involved in money laundering and said she was lied to
Wen poses at the Lindt shop in Zurich on one of her trips to Europe. She claimed it was to buy items for a jewellery business, producing receipts for diamonds and watches
Wen went to Norway on business too. It was an incredible transformation for a woman who had been living above or below Chinese takeaways for years
Jian Wen took meticulous notes in a Wallace and Gromit notebook showing what was bought and sold in terms of crypto. In this one she said ‘I’ll be dead if they broke the BTC code’ – BTC is a reference to Bitcoin
A receipt for £75,000 worth of diamonds bought in Zurich
Jian Wen arrived in the UK on a spousal visa in 2007 and was heavily pregnant.
She initially lived in Halifax and Leeds, where she completed a law diploma and a BA in economics.
Even so, she ended up working in the fast food industry, first at Fortuna Chinese (now called China City) in Leeds, and then at Hot Wok, in Abbey Wood, southeast London.
There, the single mother lived in a basement bedsit beneath the takeaway restaurant, earning £5,979 a year.
Then she met ‘supervillain’ Yadi Zhang, who allegedly introduced her to the world of crypto and money laundering.
Within months Wen was driving a £25,000 E-Class Mercedes and doing her shopping in Harrods, where she spent £30,000 a month.
She moved into a £5million six-bedroom house yards from Hampstead Heath, stumping up £17,000-a-month in rent plus six months up front and handing over a £40,000 deposit, and sent her young son to prestigious £6,000-a-term Heathside prep school.
No expense was spared as she jetted to Germany, Rome, Zurich, Norway, Thailand, China and Japan where she saw the sights under the guise of a jewellery business owner trading in diamonds and antiques. Wen then bought two flats in Dubai for more than £500,000 and began looking at bidding for a £10million 18th century Tuscan villa with views to the coast.
But when she tried to acquire a £23million Hampstead mansion she failed to pass money-laundering checks and alarm bells started ringing in the UK.
Police weren’t necessarily looking for such a huge stash of Bitcoin but it was no matter – their sting uncovered a pot of money so large it could change the fortunes of an entire nation.
For years, wealthy Chinese tycoons have used crypto has a way to take their money out of China.
Chinese law says it’s illegal to do so in China, but Britain has largely turned a blind eye, leading to massive investment in property by Chinese tycoons.
Yadi Zhang (pictured), also known as Zhimin Qian, ‘went on the run’ for six years before she was arrested this year
Pictured: Yadi Zhang’s St Kitts and Nevis passport. She allegedly stole the name from another Chinese person and used it to get ID documents
For example, the £9bn development at Battersea Power Station is thought to have been largely bought up by Chinese investors using crypto to move their money out of China.
In fact, this was so much the case that some people allegedly set up crypto exchange offices in Battersea as a result.
There is no suggestion those transactions were legally dubious but as China, Russia and America battle for control of a currency that could weaken the dollar and free up world trade, law enforcement is being drawn in to keeping a closer eye on crypto.
For the Met Police and the CPS, Wen’s conviction was a big win.
Chief Crown Prosecutor Andrew Penhale said: ‘Bitcoin and other cryptocurrencies are increasingly being used by organised criminals to disguise and transfer assets, so that fraudsters may enjoy the benefits of their criminal conduct.
‘This case, involving the largest cryptocurrency seizure in the UK, illustrates the scale of criminal proceeds available to those fraudsters.’
The money in this case is being looked after carefully, with police officers working with the CPS and other bodies to ensure the complex procedure of working out who gets to keep it is properly followed.
A Met spokesman said: ‘The Met has established processes for the storage of all seized financial assets, but due to operational sensitivities we are unable to comment any further on those processes.’
In response to the Wen case specifically, the Met spokesman added: ‘Following the seizure of bitcoin in 2021, the Met is working with the CPS and partners as part of a long and complex civil recovery investigation. This matter is ongoing and we cannot comment any further at this time.’
Just last week, the Director of Public Prosecutions called on any victims of the fraud to make a claim for the money.
Some Chinese tycoons are thought to be contemplating making such a claim, despite the wrath it may bring from the Chinese Communist Party, which has outlawed crypto trading and mining since 2021.
Louise Abbott is a cryptocurrency expert and partner at Keystone Law who hopes to represent Chinese claimants who say the money is theirs.
She told MailOnline: ‘[Wen] set up a fake investment scheme. Individuals in China invested in this scam.
‘The police are not entitled to keep [the crypto haul] at the moment.
‘The victims will be making a claim. You would have to prove your ownership.
‘There’s a big political play here. I believe the Chinese have written to the British Government to return the funds.
‘There will be pressure for Britain to deal with this very quickly.
‘It’s going to be the biggest crypto case this country has ever seen.
‘You will start to see lots of groups of individuals making claims. They need to be taking advice as soon as possible.’
Regardless, it is likely that state seizures of cryptocurrency used for criminal activity will continue.
Digital finance chief Nawab Hussain, the director of Crypto Consultants, told MailOnline the ‘state intervention’ of governments freezing and taking crypto was ‘on the rise’.
He said this was because of how often crooks were using crypto to launder money and engage in other criminal activity.
Just how much governments will be able to keep, however, could well rest on this one case.
And it is this High Court case over who gets to keep the £4.5bn, legal experts told MailOnline, that is likely to set a precedent for all other crypto seizures by law enforcement.
