HONG KONG – China’s Public Security Ministry has intensified its crackdown on illegal money exchange services and cash smuggling networks operated by loan sharks in Macau. These syndicates are making tens of millions of dollars annually by providing underground money exchange services for Chinese gamblers, the ministry announced on July 5.
Macau, often dubbed the “Las Vegas of the East,” is the only city in China where gambling is legal. However, mainland Chinese visitors, who are the primary patrons of Macau’s lucrative gambling industry, face stringent foreign exchange controls. Under Chinese law, citizens can exchange no more than US$50,000 worth of yuan into foreign currency per year and are restricted to carrying no more than US$5,000 in cash in or out of the country per trip.
Deputy Crime Bureau Chief of Beijing’s Public Security Ministry, Mr. Chen Shiqu, revealed that there has been a significant rise in recent years of illegal “money changing parties.” These groups facilitate the exchange of Chinese yuan into Hong Kong dollars through underground banks located in Zhuhai, a city adjacent to Macau. The cash is then smuggled across the border by a stream of individuals, likened to “ants moving home,” to meet the demands of gamblers in Macau.
Mr. Chen disclosed that the masterminds behind these operations make profits exceeding HK$1.5 billion (S$259 million) annually, driven by high profiteering, which has led to the rapid expansion of these groups. In a notable case, a syndicate comprising over 30 individuals recruited more than 100 cash smugglers through the Chinese video platform Douyin, posing as a hiring agency.
The Chinese authorities are determined to dismantle these syndicates and curb the illegal financial activities undermining the country’s economic regulations. The crackdown aims to restore order and legality to the financial transactions associated with Macau’s gambling industry.