Chinese Criminal Gang Sentenced for Money Laundering with Digital Yuan
A criminal syndicate in China has been convicted for engaging in money laundering activities using digital yuan as part of an elaborate international operation. As reported by Mpaypass, the People’s Procuratorate of Yuecheng District in Shaoxing oversaw the case and found individuals Yuan, Zhang, and Kou guilty of utilizing digital yuan accounts to launder and hide illicit proceeds.
The scheme involved the use of digital yuan and cryptocurrency to carry out the illegal activities. In August 2023, Yuan responded to a part-time job posting on social media that required cashing out digital yuan wallets for vendors with a commission. Yuan would purchase cryptocurrency, send it as a deposit to the advertiser, and then provide e-CNY receiving QR codes to the advertiser to transfer funds to merchants with digital yuan wallets.
Merchants would charge a service fee and return the remaining cash to Yuan in banknotes, allowing the laundering operation to continue as long as vendors with digital yuan wallets were available. Yuan, after gaining familiarity with the process, recruited his girlfriend Zhang and friend Kou to expand the operation, offering them a share of the profits.
To avoid detection, the gang communicated with the advertiser using unregulated messaging apps from overseas and moved between cities in Zhejiang province to conduct their fraudulent activities. The syndicate managed to launder over 200,000 yuan before being apprehended.
Despite the privacy features of digital yuan transactions, which are exploited by overseas fraud syndicates for money laundering, the gang was sentenced to imprisonment terms ranging from one year and four months to seven months. They were also fined for concealing and disguising the proceeds of their criminal activities.