July 19, 2016
Police have detained 31 suspects for running an illegal money-laundering scheme in Shanghai involving foreign currencies worth over 2 billion yuan (US$300 million) in the past three years. The gang, led by a 60-year-old local woman surnamed Sun, provided the service to about 100 people. Most of them exchanged Chinese yuan for foreign currencies to purchase real estate or pay for their children’s tuition in foreign countries.
The modus operandi involved clients transferring yuan into domestic accounts set up by the gang. The corresponding amount in foreign currencies was then deposited into foreign accounts of the clients through a remittance channel that worked outside the traditional banking systems. In short, money was transferred without any actual movement.