#Tether #USDT #ChinesePolice #UndergroundBanking #Cryptocurrency #FinancialCrime #Blockchain #Regulation
In a significant crackdown on underground banking activities, Chinese law enforcement authorities have dismantled a massive illicit operation involving the popular stablecoin Tether (USDT). This operation facilitated illicit money transfers totaling 13.8 billion yuan ($1.9 billion), unveiling a sophisticated scheme that exploited digital currencies to bypass financial regulations and engage in various illegal activities. The Public Security Bureau of Chengdu Municipal led the charge by arresting 193 suspects and freezing assets worth 149 million yuan ($20.6 million), signaling a decisive move against financial crime within the country.
The investigation, which commenced in 2021, exposed a criminal gang with roots in the import and export sector. This gang orchestrated a foreign exchange payment and settlement business using USDT, catering to an array of illegal activities. Among their services were financial transactions for cosmetic and drug smugglers, and individuals seeking to purchase foreign assets illegally. Moreover, their operations extended beyond mere money transfers; the gang collaborated with companies to fraudulently claim tax refunds. By employing the stablecoin USDT, they cleverly evaded China’s stringent foreign exchange controls, thus posing a significant threat to the nation’s financial stability.
The crackdown on this underground banking network is part of a broader campaign by Chinese authorities to combat financial crimes facilitated by cryptocurrencies. Recognizing the complex challenges posed by digital currencies, the Ministry of Public Security took proactive steps by forming a task force in June 2023 that carried out raids across several municipalities, leading to the arrest of suspects and seizure of financial instruments used in these illegal transactions. This nationwide campaign underscores China’s commitment to maintaining financial security and curbing the misuse of cryptocurrencies in illegal activities. Additionally, the recent actions taken by the police forces in Chengdu and Panshi City highlight the ongoing efforts to eradicate the shadowy intersections of crypto-assets and criminal enterprises, thereby reinforcing the legal and financial systems against emerging threats.
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