Han Xiao, 26, and Weizhe Huang, 21, were arrested in late 2022 after a joint investigation between the Australian Federal Police and the United States Secret Service into the US-based cyber scam.
Through a con known as "pig butchering", criminals would make unsolicited contact with victims via digital apps, posing as glamorous men or women who lived luxurious lifestyles.
Those interested were advised to create a demo account with an online trading platform where "insider advice" was given purporting to produce large financial gains.
When funds were transferred, money was unable to be withdrawn by the victims with scammers sometimes making further payment demands for releasing it.
Xiao and Huang each pleaded guilty to one count of using the proceeds of crime and faced Sydney's Downing Centre District Court for a sentence hearing on Friday.
A third man Zimo Tang, 28, who was in contact with the syndicate's "big boss" in China and received $132,000 for his role in the money laundering, was sentenced to three years and nine months in prison, with a non-parole period of two years and two months, in July.
On Friday, Judge Christopher O'Brien sentenced Xiao to a shorter sentence of three years and two months, noting he was Tang's subordinate.
While he was unaware of the wider scam, Xiao was a "necessary and important part" of the group's money-laundering activities in Australia, the judge said.
The 26-year-old's non-parole period of one year and 10 months was backdated to his arrest in November 2022 meaning he will be eligible for parole on September 24.
Xiao was enticed into the scheme in 2022 after being displaced from his family in China during the COVID-19 pandemic, which financially impacted his bubble tea business, the court heard.
He was involved in recruiting two straw directors, one of whom was Huang, and for personally funnelling around $614,000 through bank accounts held by some Samoan nationals.
Xiao's barrister Andrew Wong said his client followed Tang's directions without being aware of the entire machinations of the syndicate.
"He's in a sense the fall guy, the person who's ... taking the risk," he said.
The judge said Han Xiao showed good rehabilitation prospects, making him eligible for parole soon. (Keri Megelus/AAP PHOTOS)
While $28.4 million was laundered through bank accounts linked to the two companies assigned to Xiao's straw directors, he did not make these transfers nor was aware how much money was being funnelled through them.
Judge O'Brien found the 26-year-old had good prospects of rehabilitation, showing genuine remorse and embracing Christianity and being an exemplary inmate.
Xiao received $6300 for his role, with $2000 going toward a one-way plane ticket to Hong Kong as he attempted to flee the country, the court heard.
The 26-year-old was assisted by an interpreter as he watched the hearing from the dock wearing prison greens and a gold chain necklace.
Xiao recruited Huang through an employment ad on WeChat, saying he worked for a legitimate currency exchange business that needed someone to open up bank accounts for it after its own accounts were hit by "malicious attacks".
After the then 19-year-old university student asked whether this was connected to money laundering, Xiao falsely reassured him that everything was above board.
Huang was paid $1500 for his assistance despite around $16 million being transferred through the company in which he was a director, the court was told.
He was "gormless and naive", and was manipulated, having no knowledge of any underlying criminality, his barrister Simon Buchen SC told the court.
Because his client was "cannon fodder" and a victim who sat right at the bottom of the syndicate's hierarchy, Mr Buchen argued a conviction and good behaviour bond with no jail term was an option.
Huang is on bail and was supported in court by his mother, a police officer from China, who had flown into Sydney for the hearing.
His sentence hearing has been adjourned until October 2.
