Xing Zheng, 35, of Queens, New York, has been sentenced to more than two years in federal prison after being convicted of laundering nearly $3 million in fraudulently obtained federal benefits. The U.S. Attorney’s Office for the Eastern District of Pennsylvania announced the sentence on Thursday, highlighting the severity of the crime, which targeted government programs intended for vulnerable populations.
According to the indictment, Zheng conspired with an individual using the aliases “Christian Dasilva” and “Christian Hernandez” to orchestrate the fraudulent scheme. Together, they used stolen identities to submit false applications for Social Security Retirement Insurance Benefits and COVID-19 Pandemic Unemployment Assistance. These applications targeted unsuspecting retirees and others who were eligible for government benefits.
The fraudsters funneled the stolen funds into bank accounts under their control, and through this network, Zheng facilitated the laundering of the funds. In addition to his co-conspirator, “Christian” worked with Myrna Ortiz, 46, of Philadelphia, whom he met online. Ortiz helped to further the scheme by opening multiple bank accounts, withdrawing the fraudulently obtained funds, converting them into gift cards, and sending the card details to “Christian.”
From May 2020 onward, Zheng and “Christian” communicated using encrypted messaging platforms to arrange the sale of debit and gift cards to Zheng in exchange for cryptocurrency. Zheng, aware that the funds were illicit, used these transactions to conceal the funds’ origins.
Zheng laundered approximately $2.98 million in stolen federal benefits, keeping around 25% of the total funds. Of this, $96,500 was linked to Ortiz’s involvement, with her total participation amounting to over $600,000 in stolen benefits.
In January, Ortiz was sentenced to one day in prison, two years of supervised release, and required to pay restitution of $688,049.
Zheng’s sentence serves as a strong reminder of the legal consequences for individuals involved in financial fraud schemes that exploit government programs.
