New Place to Launder Money


According to Erika Kinetz, based on recent police investigations and lawsuits in Europe and U.S., China is offering many money-laundering methods (Kinetz, 2016). Some are,

    •  Import and export activities,

Using bank accounts in China and Hong Kong, three Columbians located in China, laundered over a $5 billion US for drug cartels in Mexico and Columbia. The money was used to purchase fake goods (copies of expensive brands in clothes, shoes, bags, etc.) in China which were later shipped to Columbia and other export markets.

    •  Informal money transfers,

Fei Gian (flying money) is an illegal money transfer method Israeli networks use to launder money through Chinese immigrants across Europe. Chinese immigrants give their money to a member of the local Chinese community in European countries like France, Spain, Italy, Germany, or Belgium. The Chinese community member, also called as the bagman, provides bank account information in China to the Israeli contact. After ensuring that money was transferred to the right account, the bagman pays the Israeli fraudsters.

    •  Cyber- scamming.

Cyber scamming is impersonating top corporate executives by creating a fake president, CEO, or corporate e-mails to trick Western companies. FBI reports that, within 2 years, scammers had conned $1.8 million US by using this method. The criminals are not necessarily Chinese however, the funds collected illegally, are transferred to the banks in China and Hong Kong.

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