Legal Developments in China
In a significant legal development, China’s Supreme People’s Court along with the Supreme People’s Procuratorate has shared a series of notable cases concerning the concealment and disguise of proceeds derived from criminal activities. Among these, a case stands out involving individuals An, Chen, and Guo, who used virtual currency as a means to obscure illicit gains.
The Scheme
The investigation revealed that from September to October 2020, the trio collaborated in a scheme to profit from transferring funds on behalf of others via an online service. An established online contact with members of a telecom fraud syndicate—a case which is currently being addressed separately—and facilitated this criminal operation by providing several of Guo’s bank accounts for their financial transactions.
Subsequently, Guo utilized one of these accounts to set up and access a cryptocurrency exchange platform. Chen was responsible for operating the trading system, directing the funds obtained from various sources into Guo’s account, which were then utilized to purchase virtual currency. This virtual currency was swiftly transferred to an account specified by the fraudsters, who compensated An and his associates based on the volume of money moved.
Victims and Legal Proceedings
As a result of this operation, confirmed victims, including individuals named Tang, Zhu, and Tong, suffered financial losses totaling over 500,000 RMB due to the fraudulent activities facilitated by An and his cohorts.
Following these revelations, the People’s Procuratorate of the Tongzhou District in Beijing charged An, Chen, and Guo with offenses related to the concealment and disguise of criminal proceeds, subsequently presenting the case in the local People’s Court. The court found compelling evidence, including testimonies from the defendants and digital evidence recovered from the devices linked to the case, confirming that the defendants knowingly participated in the transfer of funds tied to criminal activities.
Sentencing and Implications
The court ruled that the methods employed by An, Chen, and Guo to mask the illegal origins of the funds constituted serious violations of the law. Consequently, An and Chen were each sentenced to three years and three months imprisonment, along with a fine of 40,000 RMB. Guo received a slightly lighter sentence of two years and eight months in prison accompanied by a 30,000 RMB fine. This verdict has been finalized, with no options for appeal or protest, and is now enforceable.
This case underscores the increasing scrutiny and legal actions against financial crimes involving virtual currencies in China, highlighting the court’s commitment to combating the complexities of money laundering and fraud in the digital age.
