Sunday, February 5, 2023

Chinese Police Arrests Over 1100 Individuals For Money Laundering In Crypto Crackdown

The Chinese law enforcement arrested over 1100 suspects who used cryptocurrencies for money laundering in a sweeping crackdown, said the Ministry of Public Security. 

The ministry released a public statement notifying that the Chinese Police investigated 23 provinces and cities, from where it abducted over 170 groups of criminals who were using cryptocurrency for laundering money in telecom scams.

Further, it mentioned that the criminal groups were searching for new individuals, who could have helped them in laundering with their new bank accounts. 

The groups already had their bank accounts but they were seized by the authorities, therefore, they were hiring the new people in their group. The plan was to hire new people, then ask them to open a new bank account on crypto exchanges to trade the virtual currencies, the criminal group offered them. 

The criminal group had announced to offer 1.5 percent to 5 percent of traded virtual currencies to the individuals who would have been working for them. It was the easiest easy to lure people into a scam. 

This year Bitcoin experienced a huge surge and reached an all-time position, however, soon it also started coming down and China’s crackdown on cryptocurrency played a major role in it.  The recent incident of suspects being arrested is a part of that crackdown. 

According to a report, a month ago, the Chinese authorities banned the financial and payment institutions in the country from offering their services for crypto-related activities. And a few days later, the State Council of the country announces to clamp down on Bitcoin mining and trading activity.

On June 09, the Payment and Clearing Association of China published a report mentioning that they have noticed a surge in the number of crimes involving cryptocurrencies.

The association in its report added that cryptocurrencies are anonymous, convenient and global in nature, therefore, “they have increasingly become an important channel for cross-border money laundering.”

Cryptos are already a very popular mode of payments in illegal activities. Around 13 percent of gambling sites allow the usage of cryptocurrencies as the blockchain technology used by them, makes it hard for authorities to trace the transaction. 

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