Hong Kong Customs discovered a money laundering group based on intelligence in mid-2022 and launched a wealth investigation. On the 5th of this month, it took a law enforcement action codenamed "Beenet", successfully dismantling the group and smashing its large housing estate in Hung Hom The money laundering operation center of the city, the case involved about 6 billion yuan, which is the highest amount of money laundering cases ever cracked by the Customs.
During the operation, Customs officers arrested 3 men and 6 women suspected of being involved in the case on suspicion of "handling property known or believed to represent proceeds of an indictable crime" (commonly known as money laundering), aged between 39 and 68, including The mastermind of the syndicate, they are now out on bail pending further investigation.
Yang Yuwen, Superintendent of the Wealth Investigation Division of the Customs Organized Crime Investigation Division, Li Yanping, Senior Supervisor of the Customs Organized Crime Investigation Division, and Chen Jingwei, Commander of the Second Group of Wealth Investigation of the Customs Organized Crime Investigation Division, explained the case.
(Photo by Huang Weimin)
Based on intelligence, customs officers targeted a suspected money laundering group and conducted a wealth investigation. It was found that members of the group had opened multiple personal and corporate bank accounts in different local banks, and did not use personal and corporate accounts from January 2020 to December 2022 Suspicious transactions of extremely large amounts were handled, with the total amount of suspicious transactions reaching as high as 6 billion yuan.
The investigation revealed that the personal background and financial status of the members of the syndicate were extremely disproportionate to the large suspicious transactions in their bank accounts.
They even rented a residential unit in a large private housing estate, suspecting that someone used the residential unit of a large private housing estate as a cover-up money laundering operation center.
Li Yanping, senior supervisor of the Customs Organized Crime Investigation Division, described the criminal group as "extremely organized" and believed that the money laundering group had been successfully dismantled.
During the operation, the Customs searched a total of 19 premises in Hong Kong, including 10 residential units in North Point, Tai Wai, Kwai Chung and Siu Sai Wan, 8 companies and 1 money changer; and seized 3.9 million yuan in cash and 2 counting banknotes machine, 2 computers, multiple mobile phones, multiple company seals, multiple bank checkbooks and registers, multiple bank cards, a large number of bank documents and company documents.
The personnel analyzed and investigated the seized company seal and bank documents, and initially suspected that someone had artificially concealed the source and whereabouts of suspicious funds, so the shell company under the name of Li Tong forged transaction documents in an attempt to conceal the source of suspicious funds to avoid tracing.
Officers arrested 3 men and 6 women suspected of being involved in the case, aged between 39 and 68.
The nine people are the masterminds, core members and grassroots of the money laundering group, and they know each other.
Officers investigated the background and financial status of the 9 arrested persons, 6 of whom reported being unemployed, and 3 of them reported as insurance brokers, company managers and businessmen.
They reported income ranging from 20,000 yuan to 100,000 yuan.
The unit will be leased from mid-2021, and one of them, a 56-year-old woman who reported as an insurance broker, is responsible for the lease.
Customs pointed out that they noticed that the nine arrested persons frequently entered and exited the residential units of a large private housing estate in Hung Hom.
It is suspected that someone used the unit as a money laundering operation center to carry out money laundering activities. Among them, some people entered and exited the unit up to 6 times in a day, and their whereabouts were very suspicious.
One of the 56-year-old female arrestees who reported being unemployed was relatively the mastermind of the group and often stayed overnight at the unit. She was mainly responsible for the daily operation of the operation center; , and then dispatched members to the exchange shop to withdraw large amounts of cash; and recruited other people to open puppet accounts.
Customs Organized Crime Investigation Bureau wealth investigation second team commander Chen Jingwei pointed out that a total of 50 customs officers were dispatched on the day of the operation.
At that time, two arrested persons went to the money change shop involved in the case and returned to the unit involved in the case. Immediate action was taken to arrest the two persons and seized 3 million in cash from one of them. It is believed that they were in the money change shop involved in the case earlier Withdrawal of cash and arrest of persons within the unit.
Officers also arrested a 56-year-old local woman who claimed to be an insurance broker in North Point. They suspected that she was a key member of the group; a 56-year-old local man and a 54-year-old local woman in Tai Wai were suspected of using the name of themselves and their companies to open a large number of insurance companies for the group. Bank account, to assist the group in laundering money and handling suspicious transactions.
The investigation is still ongoing, and personnel will trace the background of the arrested person and the flow of funds. It is not ruled out that more people will be arrested.
A total of about 16 million bank deposits under the names of the arrested persons have been frozen immediately.
The staff believed that the money exchange shop was not involved, and would ask the shop for suspicious fund transaction records.
Customs stated that it does not rule out that someone brought a large amount of unknown cash to the operation center for processing, then distributed the cash to other members of the group, and then deposited the cash to nearby banks and ATMs.
Then someone will "break up" the large amount of cash exchanged by money changers into different bank accounts in batches, trying to cover up the source of these unknown funds and avoid attracting the attention of law enforcement agencies and bank staff .
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Yang Yuwen, supervisor of the Wealth Investigation Division of the Customs Organized Crime Investigation Division, believes that the money laundering syndicate is mature, and the division of labor among the group members is clear and careful. Handle suspicious transactions, use their personal network to assist others in handling large amounts of unknown funds, and be responsible for manipulating bank accounts to deliver cash.
He pointed out that the backgrounds and financial status of the nine arrested were not commensurate with the transactions in their accounts.
Among them, 6 have no tax filing records, and the remaining 3 have incomes of no more than 100,000 yuan, and they do not own properties in Hong Kong.
They each set up 10 companies, including import and export, food and trading companies, but all of them have no actual business, no customs declaration, no tax declaration, and they are all "shell companies".
In addition, they reported that they were the sole directors of the company, and there was no relevant company business at their registered address, and their relevant and tax filing records were not found.
During the investigation, personnel found that the criminal group had 7,600 suspicious transactions in three years, laundering a total of 6 billion yuan of funds from unknown sources.
There are various suspicious transaction patterns in the accounts. The group has opened 57 personal and corporate accounts in total. The deposits in the accounts consist of more than 800 third-party personal accounts and about 2,000 corporate accounts.
The largest single transaction exceeded 31 million.
However, the counterparty has nothing to do with the business transactions of the group members, and does not match its company background and company size.
The funds in the account are "fast in and fast out", and the funds are transferred to other accounts on the day of deposit or within a short period of time, which is not consistent with the business reported in the account opening documents.
They do large transactions at once, and the number of transactions is very frequent.
The accounts of each arrested person will also transfer funds to each other, creating multiple transactions, and the layered transaction method is further used to conceal the source of criminal proceeds.
(Photo by Huang Weimin)
Customs pointed out that they will investigate in accordance with the Organized and Serious Crimes Ordinance, and depending on the results of further investigations, they will seek the advice of the Department of Justice and apply to the court for the confiscation of suspected criminal proceeds and realizable property.
Customs pointed out that this is the first time that a criminal group has been found renting a large housing estate as a money laundering operation center.
It is believed that the security of the housing estate is relatively tight, the transportation is convenient nearby, and there are many banks, which facilitate them to take advantage of the geographical advantage to quickly carry out money laundering and quickly transfer a large amount of suspicious funds.
Since private housing estates have private passwords and resident cards, it is more difficult for investigators to track and greatly increase the difficulty of law enforcement.
Customs will strengthen communication with law enforcement agencies, including regulators and the banking industry.
Under the Organized and Serious Crimes Ordinance, any person who deals with any property, whether in whole or in part, directly or indirectly, representing any person's proceeds of an indictable offence, is guilty of crime.
Upon conviction, the maximum penalty is a fine of $5 million and imprisonment for 14 years, and the proceeds of the crime may also be confiscated.
Members of the public may report suspected involvement in money laundering activities to the Customs 24-hour hotline 2545 6182, or through the dedicated crime reporting email account (crimereport@customs.gov.hk).