On Monday (August 17), Bitcoin fell to $28,606 in the Asian market due to the hawkish impact of the Federal Reserve's FOMC minutes, and crypto funds flowed back to the safe haven of the US dollar. There was a loud noise in the Asian market. The Singapore police arrested 10 suspects and accused them of participating in overseas organized criminal activities. They all hold Chinese passports. China arrested and prosecuted four executives of Filecoin mining company Shenzhen Space Cloud Technology, accusing them of illegally making $83 million in profits. Nearly 100,000 people signed up for the project.
Singapore seizes 10 Chinese passports; MAS: Abuse of the financial system cannot be tolerated
According to the official Facebook page of the Singapore Police Force, the Singapore police arrested 10 foreign suspects on suspicion of money laundering and document forgery, including 11 documents containing virtual asset information. The total value of the property involved is about 1 billion yuan. 10 people are believed to be from Fujian, China. Three of them are Chinese citizens. The rest hold Chinese passports but have different nationalities.
Another 12 people are assisting in the investigation and 8 are currently wanted by the police, and all of them are believed to be related. All of the people involved in the case are not Singapore citizens or permanent residents.
The police issued prohibition orders for 94 assets and 50 vehicles, with a total value of more than 815 million yuan, as well as a number of jewelry and wine. The police also seized more than 35 related bank accounts with a total balance of more than 110 million yuan. The police have launched an investigation to prevent the stolen goods from being transferred. The authorities also seized more than 23 million yuan in cash, including foreign currencies, more than 250 brand-name bags and watches, more than 120 electronic devices, 270 pieces of jewelry, two gold bars, and 11 documents related to virtual assets.
If convicted, the offence of money laundering by an individual under section 54 of the CDSA 1992 carries a maximum penalty of 10 years' imprisonment, a fine of up to $500,000, or both. The offence of forgery with intent to deceive under section 468 of the Criminal Code 1871 carries a maximum penalty of 10 years' imprisonment and a fine.
The Monetary Authority of Singapore (MAS) said on Wednesday that it has worked closely with the country's Commercial Affairs Department (CAD) to facilitate the progress of the case. The official statement emphasized: "MAS takes this case seriously and has contacted the financial institutions where the potential tainted funds have been found. Supervisory cooperation with these financial institutions is ongoing. MAS will take firm action against financial institutions that are found to have violated MAS's strict anti-money laundering/counter-terrorist financing requirements or have inadequate control over money laundering risks."
"MAS will work closely with financial institutions to prevent the abuse of Singapore's financial system for illicit activities. Financial institutions are regularly reminded to remain vigilant to money laundering risks and to ensure that funds flowing into Singapore are legal and remain legal. MAS has also been conducting inspections on financial institutions active in the wealth management sector to ensure that strong controls are in place to effectively detect and address money laundering/terrorist financing risks," the statement added.
Ho Hern Shin, deputy general manager of the Monetary Authority of Singapore, said: "This case highlights that our financial institutions remain vigilant and that timely submission of STRs helps law enforcement authorities identify those suspected of engaging in illegal activities. But it also highlights that as a global financial centre, Singapore remains vulnerable to cross-border money laundering risks, and the MAS and financial institutions need to continue to work together to strengthen our defenses against these risks."
China suddenly arrested several "miners" in the country and prosecuted executives of crypto mining companies
Despite Hong Kong's efforts to become a crypto asset hub, China remains steadfast in its crackdown on cryptocurrency-related activities, with local authorities recently prosecuting one of China's largest Filecoin miners for pyramid schemes. Prosecutors in Pingnan County, the southern autonomous region of Guangxi, have filed criminal charges against four executives of Filecoin mining company Shenzhen Spacetime Cloud Technology, including organizing and leading a pyramid scheme involving more than 600 million yuan, or about $83 million.
In a blog post published after hearing the case recently, the Pingnan Court claimed that Spacetime Cloud "exaggerated" the economic model and investment potential of the distributed storage technology of its Filecoin token project. It is alleged that from February 2021 to May 2022, the company registered nearly 100,000 members on its platform, earning 606.9 million yuan and nearly 32 million USDT stablecoins, which are pegged 1:1 to the US dollar.
Prosecutors said Spacetime Cloud required members to buy or lease its mining equipment. These members also received rewards from developing new participants for the company's plans. The company lured people into giving them money with high returns, which prosecutors called a serious criminal offense that disrupted the socioeconomic order.
The charges against the four SpaceTime Cloud executives highlight China’s continued hostility toward cryptocurrency regulation since it banned financial trading of Bitcoin and other digital tokens in 2018. Their indictment came a few years after China’s State Council announced a crackdown on cryptocurrency mining in May 2021.
Filecoin is a cryptocurrency that runs on a decentralized storage network and rewards storage providers with tokens. It was launched in 2017 by Protocol Labs, the creator of the decentralized file-sharing network Interplanetary File System (IPFS), a Web3 technology that has an active following in China, where some people use IPFS to share illegal files.
Spacetime Cloud is not the first mining company to be closely watched by China. As early as December 2021, executives of Filecoin mining and storage service provider RRMine were taken away by police for investigation in Chengdu, the capital of Sichuan Province. In September 2022, the company said it had moved its headquarters to Singapore due to "China's strict restrictions on the use of cryptocurrencies." But now it seems that Singapore is also tightening its regulatory policies.
In July, the Shanxi provincial police arrested 21 people for money laundering using USD stablecoins, with the amount involved reaching RMB 380 million. In September 2022, the police in northern China's Inner Mongolia region arrested 63 people for money laundering using USDT, with the amount involved reaching RMB 12 billion.
These cases show that despite the ban, the use of cryptocurrencies in China continues to persist in the country. The bankruptcy filing of the collapsed exchange FTX showed that 8% of its customers were from China. China also ranked 10th in the 2022 Global Cryptocurrency Adoption Index of blockchain research firm Chainaanalysis, up from 13th in 2021.
The People's Bank of China (PBOC) and nine other government departments and regulators jointly announced in September 2021 that all cryptocurrency transactions in the country are illegal. They claimed that such trade disrupts economic and financial order and is a breeding ground for criminal activities.
