Chinese Police arrested around 21 suspects accused of a $54 million USDT money laundering scheme, as per a report by China’s national broadcasting service CCTV on Tuesday.
USDT is an asset-backed stablecoin pegged to the U.S. dollar and managed by Tether Limited Inc., a subsidiary of Hong Kong-based company iFinex Inc. So USDT has been criminals’ preferred choice for crypto money laundering due to easy transactions and anonymity.
The suspects have been buying discounted USDTs through over-the-counter crypto trading services since October 2021, operating across four provinces and six cities.
The accused sold the tokens at higher prices via social media platforms and crypto-related websites, making illegal profits.
The transactions totaled around 54.8 million USDT (CNY380 million) in nearly three years, says police.
The investigation began on April 1, 2023, when local police detected abnormal activity in a bank account of a resident of Jincheng in the Shanxi region, indicating high chances of money laundering, says CCTV.
At the arrest, police recovered around 40 cell phones and seized more than 1 million yuan (USD138,000) in USDT and 200,000 yuan (USD27,880) in cash.
As the case remains under investigation, all 21 suspects have confessed to the charges, which include the conversion of the Chinese Yuan to USDT by cyber criminals, says CCTV reports.
Chinese regulators banned crypto transactions in 2017 but can still access through decentralized finance(DeFi) platforms and proxy internet servers.