AFP Targets Chang Jiang Financial in $229M Crypto Money Laundering Probe
According to the administrator of Chang Jiang Financial, the allegedly dodgy money remitting business at the heart of a federal money-laundering investigation, a large amount of customer funds are being held in stablecoins within the business’ secured cryptocurrency wallet.
Administrators are now working with the Australian Federal Police (AFP) to gain access to the secured wallet, which is believed to hold over $17 million worth of customer funds.
Chang Jiang Financial has been the target of one of the largest money-laundering investigations in Australian history after it allegedly created the facade of a legitimate money transfer business in order to hide its large-scale money laundering operation.
Administrator Ups Estimate Of Funds Held in Crypto Wallet
Chang Jiang Financial’s administrator, Steven Dixon of Hamilton Murphy, told creditors at a meeting in December that the company held $15 million in unsettled foreign exchange transactions. He now puts the figure at $17.3 million.
Speaking to AFR, Dixon said a large percentage of these funds are probably held in a secured crypto wallet “containing a substantial amount of tether (USDT) tokens” which was in the custody of the AFP. Dixon stated:
We suspect that a significant portion of customer funds may be held in cryptocurrency.
Dixon says he wrote to Tether, the company behind the Tether stablecoin, for more detailed information on Chang Jiang’s crypto transactions but has yet to receive a response.
Chiang Jiang Investigation Most Complex in AFP History
According to the AFP the investigation into Chang Jiang Financial is the most complex money-laundering investigation it has led in its entire history. The investigation involved 240 AFP members, plus an additional 92 specialist members and has included the execution of search warrants in all mainland states, resulting in money laundering charges against seven people — five men and two women.
According to AFP Eastern Command Assistant Commissioner Stephen Dametto, suspicions about Chang Jiang Financial were raised when it began expanding the number of its shop fronts during COVID lockdowns, when the need for an international money-remittance service should have been at all time lows.
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…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.
It’s alleged by police that Chang Jiang Financial ran a sophisticated money laundering operation, catering to organised crime groups, alongside a legitimate money remittance business. Criminals were allegedly coached by Chiang Jiang Financial to create realistic paperwork, including fake invoices and bank statements, to avoid drawing the attention of regulators. Chang Jiang’s criminal clients were also charged a higher fee than their legitimate clients.
According to investigators Chang Jiang Financial transferred around $10 billion of customer funds since 2020, while most of these transfers were legitimate, the AFP alleges that $228,883,561 was laundered for criminal groups.