Illegal banking operators jailed

By Cao Li (China Daily)
Updated: 2007-08-07 06:47

SHANGHAI: Three Singaporeans, Loh Foy-tau, Mok Kwok-kee, and Lee Kee-yong, and a Fujian native, Chen Peixiang, were given jail terms ranging from nine to 14 years by the Shanghai No 1 Intermediate People's Court yesterday.

They were found guilty of operating an underground bank.

Loh received 14 years, Mok 14 years, Lee 13 years and Chen, nine years.

The Singaporeans will be deported on completion of their sentences.

Related readings:
Shenzhen finance center busted
Bank to get $40b for reform
State lender to go commercial
Bank fraud drops two-thirds in first half
China tightens bank credit to cool economy
30 firms banned from bank loans for pollution violations
Anti-money laundering screws tightened
The gang, headed by Loh, 30, had remitted 5.3 billion yuan abroad in foreign currencies from December 2003 to April last year on instructions of the boss of Blooming Enterprises (BE), a Singapore currency exchange company. The court did not mention the name of the boss.

They had offices in Shanghai and Suzhou, Jiangsu Province, and opened 68 private accounts in 11 different banks for the illegal trade.

They operated money transfer services between China and foreign countries without authorization.

The gang said they did not know it was against the law as it was legal in Singapore. But a scanned copy of a report on China's rules against money laundering was found in Loh's computer.

Since last year, China has imposed stricter rules to curb money laundering.

Early this year, Wu Ying, a 26-year-old woman in Yiwu, Zhejiang Province, was found to have been operating an underground bank. She was said to have assets of at least 3.8 billion yuan. She has been arrested and is still being investigated.

Loh aroused suspicion early last year when he went to the Pudong branch of the Bank of Communications almost every day to transfer large amounts of money.

The bank examined his records and reported to the city's anti-money laundering department. The gang was arrested in April.

The case also resulted in a raid on one of its major clients, an Internet foreign currency exchange in Tianjin.

It allegedly cheated clients out of millions of yuan. The company claimed it could provide access to foreign currencies and margin trading. The company told clients it could turn a relatively small deposit into a 10-fold profit.

The case is said to be the first of its kind to be cracked and is still under investigation.

(China Daily 08/07/2007 page4)

Top China News  
Today's Top News  
Most Commented/Read Stories in 48 Hours