This week, the message to criminals who exploit crypto for terrorism financing, fraud or running investment scams was clear: long prison sentences, not just fines and forfeitures, await them if convicted.
In the US, a Virginia man was sentenced to 30 years for financing ISIS terrorists in Syria via crypto, and the ex-CEO of the crypto lender, Celsius Network, faces 12 years for both securities and commodities fraud.
Meanwhile, in Singapore, a crypto mining hoax landed a Chinese national four-and-a-half years in jail and a $6,000 fine.
Find out more about each of these stories below.
US man sentenced for funding ISIS through crypto
On May 8, 2025, a US court sentenced a man from Springfield, Virginia, to 30 years and four months in prison for providing and conspiring to provide funding to the Islamic State of Iraq and al-Sham (ISIS) using cryptocurrency. Mohammed Azharuddin Chhipa carried out his terrorism financing scheme from October 2019 to October 2022, funneling a total of $185,000 in cryptocurrency to the designated foreign terrorist organization. Chhipa raised funds online through several social media accounts.
He received electronic funds transfers and traveled long distances to collect donations in person. He then converted the money into cryptocurrencies which he sent to Turkey, from where they were routed to ISIS terrorists in Syria. Among the charges against Chhipa were claims that the funds acquired in this manner were used to sponsor the escape of female ISIS fighters from prison camps.
Attorney General Pamela Bondi was blunt in commenting on the case, saying “this severe sentence illustrates that if you fund terrorism, we will prosecute you and put you behind bars for decades,” while US Attorney Erik S. Siebert added that “those who fund and facilitate terror bear the same responsibility as those who carry out attacks.”
Meanwhile, FBI Director Kash Patel noted that his agency “will investigate and work with our DOJ partners to hold accountable anyone who assists ISIS or other terrorist groups.”
Why this matters
In addition to challenging terrorists and their supporters, the collaboration among various government agencies to hold these criminals accountable is praiseworthy. While it is concerning that crypto can be used as a conduit for terrorism financing, law enforcement can take heart from the power of thorough investigation and the able support of the justice system in handing down appropriate custodial terms to those who support such organizations.
Learn more about this story at Justice.gov.
12-Year sentence for Celsius CEO over crypto fraud scheme
Alexander Mashinsky, who pleaded guilty in December 2024 to committing commodities and securities fraud, has been sentenced to 12 years in prison, along with an additional three years of supervised release. He was also ordered to pay a $50,000 fine and forfeit $48.4 million.
Announcing the judgment, Judge Jay Clayton, US Attorney for the Southern District of New York, said, “Alexander Mashinsky targeted retail investors with the promise that their digital assets would be safer than a bank, while using their assets to place risky bets and to line his own pockets.”
The crypto asset lending platform Celsius encouraged customers to ‘unbank’ themselves and through its offering ‘Earn’ promised customers a return on their investments. Celsius also encouraged them to use their crypto assets as loan collateral. Mashinsky repeatedly misrepresented Celsius methods as secure (while illegally using their assets for personal purposes), thus growing the platform to one of the largest crypto companies in the world, holding approximately $25b by 2021.
Celsius consistently misled customers about its proprietary token CEL, manipulating its price by spending hundreds of millions to artificially inflate it. When Mashinsky halted customer withdrawals in June 2022, hundreds of thousands of customers held $4.7B in now inaccessible assets, and Celsius filed for bankruptcy a month later.
In his comments, Judge Clayton praised the work of the FBI on this case and thanked the US Securities and Exchange Commission and the Commodity Futures Trading Commission, each of which has filed a parallel civil action.
Why this matters
Once again, inter-agency cooperation is commendable, and the three tiers of sentencing for Mashinsky—incarceration, a fine, and forfeiture—indicate how serious US authorities are about punishing those who exploit crypto to enrich themselves at the expense of their unsuspecting customers. This story should also remind ethical crypto businesses of the importance of maintaining strong compliance regimes, as the penalties can be severe.
Learn more about this story at Reuters.
Crypto investment scam lands Singapore CEO in prison
On May 6, Lu Huangbin of the A&A Blockchain Technology Innovation firm based in Singapore became the fourth person in the company to receive a jail sentence. He pleaded guilty to multiple charges, including six counts of cheating.
The company falsely promoted itself as having 300,000 physical mining machines capable of generating revenue by mining cryptocurrencies. Twelve investors invested over $1.8 million, suffering losses of $1,1 million.
Between May 2021 and February 2022, the company offered a scheme that promised customers a fixed daily return on their investments generated through crypto mining. A&A claimed to have acquired 70% ownership of 300,000 mining machines in China to mine cryptocurrencies such as Bitcoin and Ethereum. This was a lie; in fact, it operated a Ponzi scheme, using funds from later investors to pay returns owed to earlier investors. Lu’s colleagues in A&A who had already been sentenced were company chairman and the scheme’s mastermind Dutch National Yang Bin, chief technological officer Chinese national Wang Xingong, and Yang’s personal assistant Chinese national Chen Wei.
Why this matters
While it is concerning that Ponzi schemes and investment scams taint the crypto industry, and whether any compensation will be provided to the victims, the message from Singapore authorities to criminals is clear: the perpetrators of these financial crimes will be rounded up, tried, and face direct prison terms if convicted.
Learn more about this story at The Straits Times.
