In a tele-fraud-related case investigation, Chinese police have arrested the prime suspect and 11 others linked to a scam and money laundering activity which is the first case involving the digital yuan.
In the revelation of the Police in Xinmi on Tuesday, the incident happened in September when the victim, whose surname goes by Qu, received a phone call from an unidentified individual who claimed an item ordered online by Qu had a quality issue and that he would be compensated three times.
Qu obliged the unknown person’s request to verify its identification and ended up transferring over 200,000 yuan in batches to the suspect. Unknowingly to him, he had just fallen victim of a fraud.
The post mortem of the scam revealed that a specific electronic wallet received the said fund. However, the wallet’s transaction model was quite different from regular traditional online payment.
Further attempts to unravel the mystery by investigators revealed that digital wallet in question is allegedly owned by a 26-year-old suspect Lin from Fujian.
No fewer than 11 suspects have been arrested on suspicion of facilitating money laundering through the highly anticipated CBDC. According to the police, this case is likely the first scam and money laundry case perpetrated with digital yuan.
It is worth noting that the e-CNY “managed anonymity feature” assisted in unravelling the suspect’s identity. Such a feature is embedded in the yuan digital coin to prevent misuse and illicit activities.
According to PBOC in the Whitepaper for digital yuan:
It is necessary to guard against the misuse of e-CNY in illegal and criminal activities, such as the-fraud, internet gambling, money laundering, and tax evasion by making sure that transactions comply with [anti-money laundering/combating of financing of terrorism] requirements.