There is a money laundering group that "changes the soup but not the medicine" and once again sets up a shell company to launder money. After Customs busted a local currency exchange shop in October last year that was involved in laundering HK$600 million in black money, the investigation found that the compliance officer of the currency exchange shop who was arrested at the time continued to operate behind the scenes, instructing two other people to open shell companies and Bank account, transaction amount reached HK$1.6 billion in 3 years.
In the case, it was also revealed that a bank employee was involved in the case and instigated how to avoid bank review. Customs arrested a total of 5 people on two days from 15th to 16th of this month, including the re-arrested compliance officer of the currency exchange shop and the suspected leader of the group, as well as the latest revelations that they were involved in the case, two men who were instructed to open an account, and a banker Customer Relationship Manager.
The compliance director of a local currency exchange shop involved in money laundering is still behind the scenes of the shell company.
Last year, Customs raided a local currency exchange shop suspected of money laundering and arrested four people, including the group leader and the compliance officer of the currency exchange shop. The director was suspected of opening shell companies and bank accounts and handling HK$600 million in criminal proceeds. After the customs action, through capital flow analysis, it was discovered that the compliance officer had manipulated shell companies and bank accounts opened by two other people to launder money. At the same time, Customs discovered that a bank employee colluded with a criminal group, assisted shell companies in opening accounts, instigated how to circumvent bank inspections, and was suspected of assisting money laundering.
Two shell companies have no business address to declare their income and often remit large amounts of money in and out on the same day.
According to the Customs investigation, between August 2020 and October 2023, the two arrested persons were instructed to open two shell companies and open a total of 23 accounts in 6 local banks. When opening accounts, the two companies reported that they were engaged in mobile programming and information technology. However, the two companies had no business addresses that could be verified since their establishment, and no income was reported according to tax records.
Inspector Ou Yingzhang of the Wealth Investigation Group 1 of the Customs Wealth Investigation Bureau pointed out that during the incident, the two arrested persons were company directors. The accounts opened by their two companies had a transaction amount of HK$1.6 billion in three years, involving more than 4,000 cases. Suspicious transactions, with more than 400 counterparties. However, the two arrested persons declared themselves to be currency exchange clerks and part-time security guards respectively. Their work backgrounds were clearly incompatible with the company's financial background.
Customs also discovered that the account involved had unusual and suspicious transaction patterns. After the funds arrived in the account, they were usually transferred out within a few days or within the same day. The maximum number of transactions in a single day reached 32, and the maximum deposit amount in a single day was HK$48 million. The highest amount of accounts issued in a single day reached HK$52 million. The investigation revealed that the bank transactions in question were not conducted by the company holders, but were instead operated by the exchange shop’s compliance officer.
Bank employees involved in collusion, teaching how to "keep beautiful" company records to avoid scrutiny
Customs investigation revealed that the arrested bank's customer relationship manager colluded with the exchange shop's compliance officer to assist a shell company to open an account in a local bank. It was suspected that the customer relationship manager "promoted" to the compliance officer, including how to "execute a beautiful account" "Company records to comply with bank account opening review, and also provide tips on how to respond to bank review of suspicious amounts.
During the operation, customs seized the phones of many arrested persons. Customs will continue to investigate funds of unknown origin based on the background of the arrested persons and the flow of funds, etc. It does not rule out that more people will be arrested. Regarding the involvement of bank employees in the case, Customs has notified the Hong Kong Monetary Authority. If necessary, Customs will cooperate with the Hong Kong Monetary Authority to follow up.
Money laundering is a serious offence. Any person who knows or has reasonable grounds to believe that any property represents, in whole or in part, directly or indirectly, the proceeds of an indictable offence, commits an offence. The maximum penalty is a fine of HK$500. Ten thousand yuan and 14 years in prison, and the proceeds of crime will also be confiscated. Members of the public who use bank accounts to handle money from unknown sources may be guilty of money laundering, regardless of whether monetary rewards are involved.
Members of the public can call the Customs 24-hour hotline 182 8080, or report suspected money laundering activities through the dedicated crime reporting email account ([email protected]) or online form (eform.cefs.gov.hk/form/ced002) .
Original URL: HK01
