Beijing procuratorate uncovers major foreign exchange fraud involving over 680 million yuan

A Beijing procuratorate has uncovered a significant foreign exchange fraud case in which suspects used stolen cross-border e-commerce order information to fabricate online shopping transactions, illegally transferring more than 680 million yuan ($94 million) overseas.

In 2018, China raised the annual transaction limit for individual cross-border e-commerce retail imports from 20,000 yuan to 26,000 yuan. Purchases within this limit enjoy zero tariffs and a 30 percent reduction in import value-added tax and consumption tax. Additionally, registered payment institutions are permitted to offer small, fast, and convenient foreign exchange services through partner banks.

According to the Dongcheng District People's Procuratorate, the primary perpetrators, surnamed Yang and Qin, who had experience in cross-border logistics, established four e-commerce companies in April 2020. They signed false supply agreements with overseas companies, created an online shopping platform, and entered into cross-border payment agreements with a qualified domestic payment company.

The group advertised currency exchange services online, promising "low risk", "low fees", and "no need to review the use of funds". After receiving clients' money, they fabricated cross-border shopping orders and uploaded false order information with exchange funds to the payment company's review system. Once the orders were approved, the payment institution paid overseas suppliers. The group then transferred the foreign exchange from overseas accounts they controlled to accounts designated by clients.

From July 2020 to August 2023, the group illegally provided foreign exchange services for a technology service company and individuals, earning a 1 percent margin by adjusting exchange rates. The total amount involved exceeded 680 million yuan, with illegal gains of over 3 million yuan.

Frequent overseas payments caught the attention of foreign exchange regulators. In August 2023, police received reports and promptly launched an investigation.

During the arrest review stage, prosecutors discovered that Yang and others used multiple shell companies to sign service agreements with the payment institution, switching companies once abnormal transactions were detected. They also evaded sample checks by modifying or withdrawing orders.

Investigators found a customer manager surnamed Cao from the payment company involved in the case. Cao later admitted to accepting more than 300,000 yuan from Yang's group to help them evade risk control checks. He was sentenced to one year in prison with a one-year reprieve and fined 100,000 yuan.

Prosecutors also discovered that while the identities and logistics numbers in the uploaded orders were real, the product names and prices had been altered. The investigation led to Cheng, an e-commerce department manager at a cross-border logistics company in Tianjin. From September 2020 to December 2022, Yang's group purchased over 300,000 pieces of order information from Cheng at about 0.3 yuan each. The data included buyers' names, ID numbers, phone numbers, addresses, logistics numbers, product names, and prices. Cheng was sentenced to three years in prison and fined 200,000 yuan.

Yang, Qin, and a finance staff member surnamed Li were prosecuted for fraudulently purchasing foreign exchange, conducting illegal business operations, infringing on citizens' personal information, and bribing a non-state employee. Prosecutors also filed an incidental civil public interest lawsuit.

A first-instance court ruled in June 2025 that the illegal use of personal information was a tool for the foreign exchange fraud and did not punish it separately. Prosecutors filed a protest, arguing that infringing on citizens' personal information violates privacy rights, while fraudulent foreign exchange purchases disrupt financial security. Both harm distinct legal interests and should be punished cumulatively by law.

In March this year, the second-instance court accepted the prosecutors' opinion and sentenced Yang and others to prison terms ranging from nine years and six months to two years and ten months. They were fined between 15.11 million yuan and 1.11 million yuan, ordered to pay more than 780,000 yuan in public interest damages, delete the personal information involved, and issue public apologies in national media.