Police in China have made more than 1,100 arrestsin the latest round of crackdowns on criminal groups providing money laundering services to telecom fraudsters. The Ministry of Public Security announced on June 9 the fifth round of Operation “Card Broken,” which aims to crack down on gangs carrying out criminal activities in cyberspace.
Specifically, Operation “Card Broken” focuses on telecommunications network fraud, including the sale of phones, payment cards, and money laundering services through China and across borders.
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The Ministry specifically pointed out that "coin farmers", in which associates or members of criminal groups facilitate the laundering of proceeds from illegal activities through cryptocurrencies, in order to avoid law enforcement scrutiny in the country.
Coin farmers are said to sign up for different cryptocurrency exchanges and create personal accounts. They then buy or sell cryptocurrencies based on instructions and the money they are given. The digital currency is then sent to wallets controlled by gang members.
In return for their activity, farmers receive a commission of between 1.5% and 5%. The Ministry states that the high illegal income attracts a large number of people to participate, causing serious social harm.
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The operation, in its fifth round, focused on the criminal chains of these activities, dismantling at least 170 criminal groups. As part of this effort, law enforcement authorities in provinces such as Beijing, Hebei and Shanxi.
In total, the operation resulted in the dismantling of approximately 15,000 gangs, while 311,000 people suspected of participation have been arrested, according to the Ministry.
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China has taken a tough stance on cryptocurrencies, blocking such transactions and warning that the trade disrupts the "economic and financial system."
While individuals are still allowed to own cryptocurrencies, three state-sponsored financial authorities recently issued a joint warning, reminding citizens that cryptocurrencies cannot “play a role in China.”
Information source: zdnet.com
