November 4, 2021

Unfortunately it doesn't smell, CBDC China is caught up in Money Laundering!

 The Chinese government is just in the phase of celebrating the launch of the Digital Yuan trial in their country which aims to be a secure and centralized digital payment method. But unfortunately it did not smell, it was only during the trial period that the authorities discovered the first money laundering using China's CBDC.

Xinmi Public Security officials along with the anti -corruption body have arrested 11 suspects in Fujian Province for illegally using digital Yuan to launder money. In addition, authorities revealed that members of the group used China’s CBDC to continue laundering money for outside groups.

The CBDC China scam is done through a telecommunication medium where victims of the scam will receive random calls about online purchases about their defective products. Fraudsters will offer compensation to the buyer by buying the item at three times the price of the product.

Fraudsters will ask the victim to perform verification, which also includes some transfers via digital yuan. Based on local reports, authorities revealed that some payments are being transferred into certain electronic wallets. So far, the suspects have been arrested and charged under the criminal investigation act.

The report has to some extent adversely affected the digital yuan and carries an indication that the digital yuan has not escaped illegal financial activities. The inability of digital to eliminate financial crime leading to the use of crypto assets has raised great concerns over China’s use of CBDCs.