Chinese Police Arrest 21 in $54M USDT Money Laundering Probe

July 21, 2023

By Sharan Kaur Phillora

In an extensive crackdown on cybercrime, the Chinese police in Shanxi Province have unmasked a mammoth Tether (USDT) money laundering operation, culminating in the arrest of 21 individuals, as per regional news outlets.

Here’s what we know:

Chinese national broadcaster, CCTV, has revealed that the operation, utilizing the US dollar-pegged cryptocurrency USDT, is speculated to have netted more than $54 million for the accused, making this one of its most substantial financial crimes.

Operating over a vast geographical spread encompassing six cities across four provinces, the alleged criminals are reported to have started their illicit operation in October 2021. 

By acquiring USDT at discounted rates through over-the-counter crypto exchanges, the suspects managed to resell these tokens at inflated prices through the social media platform WeChat and various money laundering platforms. This profitable cycle continued for almost three years, raking in an estimated $54.8 million.

The scheme was brought to light when police identified an unusual influx of funds into one individual’s account, triggering suspicions of a “running points” laundering method where one party collects money from others using their bank card or online method, then transfers it.

Simultaneous to the arrests, law enforcement confiscated 40 cellphones, seized over 1 million yuan ($138,000) in USDT from the suspects’ accounts, and apprehended more than 200,000 yuan in hard cash.

All 21 suspects have confessed to using the stablecoin to launder money for cybercriminals. The case remains active as the authorities continue their investigative procedures.

About the author

Sharan Kaur Phillora’s thirst for knowledge has led her to study many different subjects, including NFTs and Blockchain technology – two emerging technologies that will change how we interact with each other in the future. When she isn’t exploring a new idea or concept, she enjoys reading literary masterpieces.

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