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Malaysian Police Busts Illegal Crypto Exchange Suspected of USDT-Powered Money Laundering and Gambling Syndicate

In a significant operation, Malaysian authorities have successfully apprehended what they believe to be an illegal international cryptocurrency exchange operating with the support of USDT (Tether). The crackdown resulted in the arrest of forty individuals, shedding light on a network allegedly facilitating unauthorized trading activities and illegal online gambling. Malaysian law enforcement agencies, including the commercial crime investigation team and the National Financial Crime Center, collaborated to dismantle this operation and seize significant assets.

Investigation Reveals a Sophisticated Scheme:

Authorities had been diligently investigating the suspected crypto exchange, which was reportedly enabling mainland Chinese citizens to convert USDT into cash. The exchange meticulously converted funds received from China into USDT, subsequently transferring these tokens back to Chinese individuals. Detectives discovered compelling evidence of the group conducting cryptocurrency exchange activities within Malaysia without the required regulatory permissions. Under Malaysian law, all crypto-related enterprises must register their operations with relevant authorities, and non-compliance can result in severe penalties.

Enforcement Action and Ripple Effects:

This recent crackdown follows the Malaysian Securities Commission’s directive to cease operations by Huobi Global, a prominent cryptocurrency platform. Huobi Global was ordered to disable its website and mobile applications, including those on popular marketplaces like Apple Store and Google Play. Despite China’s ban on crypto trading, evidence suggests that Mainland China-based individuals continue to engage in cryptocurrency transactions via overseas platforms.

Successful Raids and Seized Assets:

In a synchronized effort, Malaysian police raided multiple locations, resulting in the detention of male and female suspects. The suspects ranged from 20 to 58 years old, including Malaysian nationals, 15 men, six women from China, and at least one Singaporean man. Law enforcement officers confiscated substantial evidence, including 88 mobile phones, USD 5,000 in cash, gold bars, luxury watches, handbags, assorted gold jewellery, and several vehicles. Furthermore, it was uncovered that the illegal exchange operated a gambling syndicate primarily catering to Taiwanese customers.

Cracking Down on Money Laundering and Gambling:

The suspects are believed to have facilitated money laundering by using “money mule” bank accounts, allowing Chinese individuals to exchange chips for online gambling platforms. This revelation highlights the wider implications of this criminal network, which operated beyond cryptocurrency trading and extended its activities to illicit gambling operations.

The recent crackdown on the suspected illegal crypto exchange in Malaysia signifies the government’s commitment to combating financial crimes and maintaining regulatory compliance within the cryptocurrency industry. The successful operation, which resulted in the arrest of multiple individuals and the dismantling of a sophisticated network, demonstrates the ongoing efforts to safeguard the financial system’s integrity. As cryptocurrencies continue evolving, regulatory authorities are intensifying their efforts to prevent money laundering, illicit trading, and associated criminal activities.

Crypto products and NFTs are unregulated and can be highly risky. There may be no regulatory recourse for any loss from such transactions. Crypto is not a legal tender and is subject to market risks. Readers are advised to seek expert advice and read offer document(s) along with related important literature on the subject carefully before making any kind of investment whatsoever. Crypto market predictions are speculative and any investment made shall be at the sole cost and risk of the readers.