AFP busts $229m Chinese money laundering operation
The complex scheme was conducted through money remitters operating for years in “plain sight” and allowed gang members to lead lavish lifestyles in Melbourne.
The AFP has thwarted a Chinese crime syndicate that allegedly laundered $229 million over three years through a popular money remitting chain in the culmination of its most complex investigation in history.
Raids on Wednesday involving 240 AFP members resulted in the seizure of more than $50 million in assets and the arrest of four Chinese nationals and three Australian citizens connected with the Long River Chinese gang.
Police alleged that Long River’s scheme involved washing $229 million obtained from cyber scams, trafficked goods and violent crimes through money remitting chain Changjiang Currency Exchange.
“Unlike traditional money laundering organisations that exploit vulnerabilities in the financial sector, the Long River money laundering organisation entrenched itself into the very fabric of the financial services industry, becoming one of the largest independently-owned remitters in the country. We allege that enabled it to exploit vulnerabilities far more easily, and for a period of time,” he said.
The Changjiang Currency Exchange had 12 retail outlets across Australia and caught authorities’ attention after it opened new locations during COVID-19 lockdowns, Mr Dametto said.
“During COVID-19, AFP members were still coming into work, and while most of Sydney was a ghost town, alarm bells went off among our money laundering investigators when they noticed Changjiang Currency Exchange opened and updated new and existing shopfronts in the heart of Sydney,” he said.
“It was just a gut feeling – it didn’t feel right. Many international students and tourists had returned home, and there was no apparent business case for Changjiang Currency Exchange to expand.”
The Changjiang Currency Exchange allegedly transferred a total of $10 billion over three years.
While most of the transferred funds were from legitimate customers, the AFP alleged that the company routinely helped Long River move money around.
The AFP said the money remitter transferred funds to national and international accounts, claiming they were customers’ legitimate business profits and expenses. Accomplices would create fake business paperwork, such as invoices and bank statements, to legitimise these transactions in the event authorities came knocking.
Mr Dametto said the money laundering operation bankrolled Long River members’ luxury lifestyles in Melbourne.
“We allege they lived the high life by eating at Australia’s most extravagant restaurants, drinking wine and sake valued in the tens of thousands of dollars, travelling on private jets, driving vehicles purchased for $400,000 and living in expensive homes, with one valued at more than $10 million,” he said.
Photos released by the AFP show the seizure of luxury watches, including one Rolex worth $94,000, cars including a Lexus, Porsche and a $400,000 Mercedes-Maybach GLS, and Hermes and Louis Vuitton handbags.
The AFP also charged on Wednesday a Melbourne man for allegedly using the Long River syndicate to help launder $100 million obtained from a cyber scam.
The Chinese national is the seventh person arrested for being involved in the global scam that was investigated in a joint operation between the AFP and the US Secret Service.
Over the past year, the AFP has arrested or charged 26 people for money laundering offences.
AUSTRAC acting deputy CEO Brad Brown said the intelligence agency’s collaboration with the AFP was critical in helping to disrupt money laundering operations.
“Today’s outcome reflects the combined impact of AUSTRAC’s financial intelligence expertise, regulatory powers, and the effectiveness of our multilateral engagement with industry partners and law enforcement,” he said.
Mr Brown highlighted the risk of money remitters posed for financial crime.
“Remittance businesses provide a critical service to the community, and the vast majority operate legitimately,” he said.
“However, the nature of the business means remitters are at a higher risk of exposure to money laundering, terrorism financing and other serious crimes. The onus is squarely on remittance businesses to understand and comply with their anti-money laundering and counter-terrorism financing obligations.”
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