Beijing cracks down on city’s illicit ‘currency exchange gang’

China’s Ministry of Public Security has launched a major crackdown on “money exchange gangs” operating in Macau, targeting illegal foreign exchange activities linked to a surge in fraud, robbery and kidnapping.

The ministry said the move is to curb the “arrogance of criminals” and disrupt the entire illicit network.

According to the ministry, the “money exchange gangs” refer to groups in Macau illegally providing large-scale cash exchange services and loan sharking to gamblers.

In recent years, the ministry has seen a significant increase in the number of these groups organizing mainland Chinese to illegally engage in foreign exchange trading in Macau.

The crackdown has already yielded results, with authorities across China reporting a series of successful operations.

In Jilin, police cracked a case involving RMB10 million in illegal exchange activities, while in Jiangxi, over 30 people were arrested for selling illegal entry and exit documents to facilitate Macau trips for illicit currency trading.

Guangdong police, meanwhile, eliminated three fraud gangs using “practice banknotes” (non-genuine banknotes) for exchange, detected five illegal exchange cases, and busted six underground money laundering operations, arresting 101 suspects and seizing RMB1.47 billion.

These criminal organizations are reportedly overseen by “hidden financers”, and the transfer of Hong Kong currency and renminbi is carried out through clandestine financial institutions in the nearby city of Zhuhai. It is estimated that these illicit activities have yielded yearly earnings exceeding HKD1.5 billion.

Sit Chong Meng, Judiciary Police (PJ) director, has acknowledged the strong support of the ministry.

He said public security authorities across mainland China are comprehensively cracking down on related black and grey industries and have already achieved significant results.

“In recent months, there has been a drop in the number of illegal crimes involving money exchange gangs,” he said.

“The (PJ) will actively cooperate with the mainland public security authorities in special operations to rectify the illegal activities of money changers at the source.”

The crackdown comes as Seaport Research Partners analyst Vitaly Unmasky, warned of the potential negative impact on Macau’s gaming industry, with the disruption of unofficial currency exchange channels potentially leading to a slowdown in mainland Chinese travel to the gambling hub.

However, the authorities appear determined to maintain a “strict and high-pressure” campaign against the money exchange gangs, vowing to take further measures to eliminate the problem at its source. Victoria Chan