Taipei prosecutors yesterday charged a garment firm owner and three other people with illegally transferring about NT$13 billion (US$423.9 million) to China over nine years.
Chen Chun-hsiung (陳俊雄), a major figure in Taipei’s Wufenpu (五分埔) garment district and owner of Santong Embroidery Co, along with three employees, was charged with contravening provisions in the Banking Act (銀行法) on overseas and domestic money transfers, prosecutors said.
Many of the textile and garment shops around Wufenpu source their products from China, a large number of which make use of Chen’s operation to pay their Chinese suppliers, investigators said.
The companies favor this route for cross-strait money transfers, because Chen charges a lower service fee and has fewer restrictions compared with registered banks and financial instituations, the investigators said.
Prosecutors found that from 2009 to 2015, Chen facilitated NT$13 billion in illegal money transfers and made a profit of about NT$60 million from commissions and handling fees.
They said that Chen has good connections in China who help him navigate China’s banking regulations.
To pay their Chinese suppliers, Chen’s Taiwanese clients would first wire the money in New Taiwan dollars to a designated account in China.
After confirming the transfer, Chen would call up his contact in China to convert the money into Chinese yuan, withdraw it and transfer it to another account for pick-up by the Chinese supplier, prosecutors said.
Separately, the Taoyuan District Court yesterday approved a request to detain four people suspected of engaging in money laundering by wiring money from Taiwan to China.
Prosecutors said that a man, surnamed Wu (吳), was the leader of an illegal banking operation in Taoyuan that has about NT$400 million in two offshore banking unit accounts.
The three other suspects reportedly worked for Wu.
Prosecutors said the four would be charged with contravening the Money Laundering Control Act (洗錢防制法).
Investigators discovered Wu’s activities when they were handling a kidnapping case in China in April.
A Taiwanese businessman, surnamed Lee (李), was kidnapped in China and his family wired NT$20 million to China to secure his release.
Investigators traced the transaction to Wu’s underground banking operation and said they suspected that Wu had connections with the gang who carried out the kidnapping.
A cross-strait joint investigation had found seven suspects — two Chinese and five Taiwanese living in China — with a 53-year-old Taiwanese man, surnamed Huang (黃), allegedly being the mastermind who planned the kidnapping.
Chinese police reportedly tracked down and arrested the seven in August.
They are being detained in China pending trial, reports said.
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