The best place to hide your money is by keeping it moving, like hide and seek, you keep hiding somewhere else … until you get caught. This is what happened to some of the shady people that laundered money through banks. I can’t remember if I read about this topic in an article or from a book [this is the closest I’ve got], but those who launder money through banks were taking it out of the country, because they planned on emigrating and living off their wealth with less suspicion and surveillance by a different government.
There was one family who was involved in an extremely elaborate scheme where they kept transferring a certain amount of money to accounts with different names, but all the accounts were owned by one of those family members. Are you still with me? The money kept being transferred until it was in a Scandanivian country or another country where another family member was living and receiving the money. The ones in China planned on continuing until they transferred all their money, and then emigrated to that country. It’s illegal to transfer a certain amount of money at one time, and they were eventually caught and punished.
Just think about the ramifications of transferring a huge amount of money when you control a significant portion of what’s available. You are damaging the Chinese economy because China has much less money in circulation, which is likely to cause a crunch in the economy.
Not everyone transferring money is doing it to stick it to the government. Some families transfer money as in sending money to loved ones outside of China. In the U.S., we’re familiar with stories of families coming to the U.S. to make money and send it back to family in our home countries. So sending money should not be lumped together as a bad thing.
The article is copied and pasted from CNN Money. There’s a video from the source.
China busts $64 billion underground banking ring
Chinese officials have busted the country’s largest-ever underground banking ring, involving transactions totaling $64 billion.
Some 100 suspects from eight gangs have been detained since police in eastern China launched the investigation last September, according to official state media.
The gangs were thought to be linked to a ringleader who allegedly operated multiple shell companies in Hong Kong engaged in money laundering and foreign exchange transactions.
China has strict capital controls — citizens can only move around $50,000 out of the country each year.
The restrictions have given rise to a shadowy world of money laundering — via unique means from fine art buys to casinos in southern China — that helps people send funds abroad. While some of that money comes from honest earnings, a portion is believed to have been obtained via corruption or fraud.
Over the past year, officials have issued arrest warrants for 56 people, frozen 3,000 bank accounts, shut down 37 unlicensed financial institutions allegedly laundering money and reviewed over 1.3 million suspicious transactions, reported state media.
Police busted another 10 unapproved banks this week, allegedly linked to about 51.6 billion yuan ($8.1 billion) in illegal transactions.
CNNMoney (Hong Kong) November 20, 2015