The Chinese authorities have announced that more than 170 criminal gangs have been eliminated and over 1,100 suspects have been arrested in the latest round of the raid criminal groups providing cryptocurrency money laundering services to telecommunications scammers.
Taking action against telecommunications fraud with cryptocurrency for money laundering
The Ministry of Public Security of the People’s Republic of China announced on Wednesday that the fifth round of Operation Broken Card has been carried out.
This has “cracked down on illegal and criminal groups offering virtual money laundering services for telecommunications fraud,” the ministry said, adding:
More than 170 criminal gangs were eliminated and more than 1,100 criminal suspects arrested.
The criminal gangs used cryptocurrencies to transfer funds involved in the case, the announcement said.
Police investigations have shown that these criminal gangs usually work with “coin farmers” who help the fraudsters with money laundering. These coin farmers would register with various cryptocurrency trading platforms and buy and sell cryptocurrencies according to the gangs’ specifications. The announcement describes:
After completing the money laundering process, “coin makers” can receive commissions of 1.5 to 5%. The high illegal income attracts large numbers of people to participate, which causes serious social damage.
The announcement goes on to say: “So far, the ‘Broken Card’ operation has eliminated 15,000 illegal criminal gangs … arrested 311,000 suspects … and controlled 18,000 illegal industries and institutions.”
Operation Broken Card was launched on October 10th last year after the State Council, China’s cabinet, convened a joint inter-ministerial meeting to tackle a new breed of illegal telecommunications network fraud. Cell phone and bank cards are particularly affected.
China’s Payment & Clearing Association announced on Wednesday that the number of crypto-crime is increasing. Cryptocurrencies have “increasingly become an important channel for cross-border money laundering,” the association said in a statement, adding that they have already become a popular means of payment for illegal gambling activities. The association found that almost 13% of gambling sites support the use of cryptocurrencies, which has made tracking difficult.
The Chinese authorities recently stepped up their efforts to crack down on illegal activities involving cryptocurrencies. In addition to repeating their ban on cryptocurrencies issued a few years ago, three industry organizations recently banned crypto-related financial and payment services. The State Council has also announced that it will take action against Bitcoin mining. On Wednesday, Bitcoin.com News reported that China’s Qinghai Province had ordered the shutdown of Bitcoin mining operations.
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