China reveals Money Laundering worth USD 1.75 billion
Chinese authorities have recently found 7 big underground banks engaged with money laundering cases worth more than USD 1.75 billion. Police arrested 44 people suspected of being involved in the underground banks that were found in Shanghai, Inner Mongolia, Guangdong, Liaoning, Heilongjiang and Xinhua.
China has been seeking to crack down on illicit financial activities in order to reinforce the stability of its developing financial systems and prevent possible involvement in terrorist financing. Urgency to the issue has been added by suspected links between China and international drug trafficking syndicates.
The biggest case so far was reported earlier in the beginning of December. It involved a money laundering operation carried out by a Singaporean in Shanghai, suspected of handling USD 630 million. That underground bank was offering foreign exchange, transfers as well as other banking services between Singapore and 25 major Chinese cities. Authorities managed to seize frozen accounts worth USD 7.4 million.
The changes in Chinese legislature have already been discussed previously. The national legislature has recently enacted China’s 1st anti-money laundering law that gave the central bank greater investigative power. One of the biggest changes was including bribery in the list of money laundering crimes covered. The new law is to come into effect on January 1, 2007.