FOUR gangs were busted in November for allegedly being involved in illegal foreign exchange trading in Shenzhen by police after a yearlong investigation that started in 2015, the Southern Metropolis Daily reported yesterday, citing the public security bureau.

    A total of 18 people were interrogated and eight of them have been detained by police.

    Police said that 14.46 billion yuan (US$2.1 billion) was involved in the case, which is still under investigation.

    It was a corruption case that the bureau had received led to the investigation of the underground banks in November 2015. Police investigated more than 2,000 bank accounts and tens of thousands of trade records before realizing that the direction of the capital flow was involved in the bribery case.

    Police noticed that large sums of money had been transferred to a bank account belonging to a resident in his 80s surnamed Zhan. It was found that over two months the total transaction amount to Zhan’s account was 260 million yuan. What made the account more suspicious was that the money never stayed in his account overnight.

    Through investigation, police found that Zhan was the uncle of the case’s key suspect, identified as Qiu. The exposure of Qiu led to the investigation of three other illegal trading groups. All of the suspects were related or friends.

    Police raided five dens in various residential compounds and office buildings in November. Eighteen suspects were taken back to police stations for interrogation. Police then froze 76 bank accounts containing over 5.58 million yuan and seized a batch of forged company licenses, bank cards and online bank keys.

    One of the suspects, surnamed Liang, was caught red-handed in an office building in Nanshan District. Liang was about to make a foreign exchange transfer worth 400,000 yuan to a client when he was busted, according to Futian police.

    Both Qiu and Liang had set up their own international freight companies in Shenzhen and took advantage of receiving U.S. dollars to trade foreign exchange illegally. They made profit by charging transaction fees and taking the difference in the exchange rates.

    Nationwide, crackdowns on underground banks have been conducted by the Ministry of Public Security, along with Bank of China and the State Administration of Foreign Exchange, since 2016.

    Police around the country have busted more than 500 underground banks. Over 800 suspects, and more than 900 billion yuan, were involved in the cases. (Zhang Qian)