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Chinese Criminal Gang Sentenced for Laundering Money with Digital Yuan

In an international scheme, a criminal syndicate in China has been convicted of money laundering utilizing digital yuan. As detailed in an Mpaypass report, the People’s Procuratorate of Yuecheng District, Shaoxing, presided over the case, resulting in the guilty verdicts of individuals Yuan, Zhang, and Kou. They were found to have employed digital yuan accounts to launder and obscure illicit gains.

Money Laundering Using Digital Yuan and Crypto

In August 2023, Yuan stumbled upon a part-time job opportunity on social media and decided to seize it. The advertiser propositioned Yuan to facilitate cashouts from vendors’ digital yuan wallets, offering a commission of 0.8%.

To kickstart the process, Yuan initiated by acquiring cryptocurrency and transferring it as a deposit to the advertiser. Subsequently, upon locating merchants with digital yuan wallets, Yuan would furnish the e-CNY receiving QR code to the advertiser, who then executed the money transfer to the merchant.

Following the transfer, merchants typically levied a “service fee” ranging from 1% to 1.5%, refunding the remaining amount to Yuan in banknotes. As long as Yuan could identify vendors with accessible digital yuan wallets, the laundering operation persisted.

With a few rounds under their belt, Yuan grew adept at the process. “I didn’t anticipate the money flowing in this swiftly; undertaking it solo feels sluggish,” remarked Yuan.

Yuan Recruits More to Expand Operation

Despite being cognizant of the dubious source of the advertiser’s funds, Yuan succumbed to temptation and roped in his girlfriend, Zhang, and friend, Kou, enticing them with a promise of 50 yuan for every 10,000 yuan they assisted in cashing out, aiming to pocket the difference.

Given the scarcity of shops equipped with e-CNY accounts willing to engage in such transactions and the risk of detection from repeated actions, the gang adopted precautionary measures to evade law enforcement. They resorted to communicating with the advertiser through unregulated messaging platforms originating from overseas.

Commencing early September, they embarked on a spree across cities in Zhejiang province, relocating to fresh crime scenes post-successful cashouts, ultimately laundering an excess of 200,000 yuan in fraudulent funds.

“Digital yuan transactions boast robust privacy features, exploited by overseas fraud syndicates to procure merchants’ accounts for money laundering,” admitted Yuan.

Recently, the court delivered verdicts, sentencing the gang to fixed-term imprisonments spanning from one year and four months to seven months, coupled with fines for their role in concealing and camouflaging illicit proceeds.

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