GGRAsia – 10 fined over forex tied to aiding overseas bets: China

10 fined over forex tied to aiding overseas bets: China

China’s State Administration of Foreign Exchange says it has sanctioned 10 mainland residents for alleged involvement in either underground bank transactions or the use of illegally-modified point-of-sale (PoS) terminals for what it called “cross-border gambling” purposes.

It didn’t mention any jurisdictions by name, although China has said it may blacklist any places that specifically target mainland residents as gambling customers.

In a Friday release, the administration listed offences allegedly involving 10 individuals – and covering a period from 2016 to 2020 – that involved “illegal trade in foreign currencies for gambling”. Seven of the cases involved transactions made via underground banks, and the remaining three involved the use of illegally-modified PoS terminals, the release said.

The foreign exchange administration did not specify where the money was being sent. But the government body cited there had been violations of China’s foreign currency trade regulations, and that fines had been issued to all 10 individuals.

The heftiest fine was CNY1.564 million (US$241,592), on a mainland resident said to have engaged four times – between November 2018 and June 2019 –  in illegal transactions relating to foreign currency amounting to US$1.13 million.

The offences and fines relating to the 10 people had been lodged with the “credit reference centre” of the People’s Bank of China, said the State Administration of Foreign Exchange. The credit reference centre was established to collect credit information of companies and individuals in mainland China.

On April 23, the People’s Bank of China said in a statement that it had met on the same day with several government departments – including the State Administration of Foreign Exchange – about continuing a clampdown on outbound capital suspected of supporting “cross-border gambling activities”.

The  focus would be on making use of financial technology to “enhance know-your-customer practices” and to “monitor and handle suspicious transactions”.

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