Cross-border payments experts say innocent senders in Singapore may have been caught up in increasingly frequent money laundering investigations by the Chinese government, which freezes accounts in China as part of investigations. He said it was highly sexual.
China steps up crackdown on money laundering activities by criminals such as “money mules”, third-party individuals, or fraudsters who use corporate brokers to move funds without making physical transfers they said.
Mules, or “smurfs” as they are sometimes called, are used by criminals around the world to launder ill-gotten funds, usually by making small undetectable deposits into legitimate bank accounts or This is done by remittance. However, many money transfer companies also use mules to “send” funds.
For remittance operators, mules (some of which have local licenses) are cheaper than official banking services, and for consumers they translate into significant foreign exchange savings. It also avoids hurdles for cross-border payments, such as China’s restrictions on capital transfers of more than 50,000 yuan (US$7,000).
China’s “underground” banking network is deep and complex, said Ella Mak, co-founder of Singapore fintech company Aleta Planet, which facilitates global payments through a well-known card network.
Mak added that the network in mainland China also extends to Hong Kong, Singapore and various countries in Southeast Asia.
“It’s a well-woven web…but because it’s a web, if you find one party in the web, it can lead to all the other parties,” she said.
“Since 2011, the Chinese authorities have actively implemented various policies to eliminate these mule accounts. But it’s not thousands, but millions of accounts…China’s currency exchange business is It’s just as old.”
Mack said Chinese authorities are cracking down on transactions ranging from large-scale transactions to those involving individuals, such as small and medium-sized businesses and remittance customers.
In addition to freezing suspicious Raba accounts, Mack said, Chinese authorities plan to freeze all accounts from which Raba sent or withdrawn money.
“This means that China is stepping up its efforts to fight money laundering and ensure that funds entering and exiting China are legal,” he said, adding that these efforts are strengthening the fast-growing economy’s financial system. It added that this is tied to the Chinese government’s goal of strengthening the
The Monetary Authority of Singapore (MAS), the city’s central bank and the country’s police said that three money transfer companies and 39 customers were affected in the latest imbroglio: Hanshan Money Express, Samlit Moneychanger and Zhongguo Remittance.
Police have so far received more than 670 reports of frozen remittances, amounting to S$13 million (US$9.8 million), which is “lower than the total amount of remittance transactions through remittance companies.” “Only a few.”
According to MAS and police, about 430 of the calls involved Samrit money changers.
Some of these companies, which have helped thwart fraud in the past, have also been implicated in recent money laundering cases, according to local media.
Since these companies have paid out the funds, it may be difficult to recover them for their customers, a compliance expert at a Singapore payment service fintech who requested anonymity said in Asia this week. He added that it could take a long time for victims to get their money back.
“The Chinese authorities will not know how to separate clean money from dirty money,” he said.
“[I suspect] The quickest way to get your money back is to go to China with receipts, police reports, and supporting documents and ask the authorities to release the funds.
“The funds are already in China, so it’s beyond Singapore,” the compliance expert said.
Meanwhile, other countries that have maintained favorable exchange rates with China could also be drawn into Beijing’s crackdown, he said.
Fanson Yip, founder of MoneyChain, one of Australia’s largest independent money transfer businesses, said there were no red flags regarding Chinese remittances from the country.
But he said any account freeze by China was likely related to an investigation into illegal activity, and foreign exchange trades that seemed too good to be true could also be “dangerous.”
“I think a lot of people are using these third parties like a platform, and it’s not just China, it’s India, Pakistan, Malaysia, the Philippines, everywhere,” he said.
Representatives from AUSTRAC, the Australian government’s financial intelligence agency responsible for monitoring financial transactions to identify money laundering and other financial crimes, said in Asia this week that they are working closely with Chinese authorities on mutual financial crime threats. “I cannot comment on specific issues,” he said. Administrative Matters”.
The suspension in Singapore comes after authorities in August investigated the country’s biggest money laundering case involving S$2.8 billion (US$1.3 billion) in assets.