China Watchdog Finds $10 Billion in Fake Currency Trade

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China Watchdog Finds $10 Billion in Fake Currency Trade
By Bloomberg News Sep 25, 2014 3:39 PM

China uncovered almost $10 billion in fraudulent trade nationwide as part of an investigation begun in April last year, including many irregularities in the port of Qingdao, the country’s currency regulator said today.

Companies “faked, forged and illegally re-used” documents for exports and imports, Wu Ruilin, a deputy head of the State Administration of Foreign Exchange’s inspection department, said at a briefing in Beijing. The trades have “increased pressure from hot money inflows and provided an illegal channel for criminals to move funds,” Wu said, adding that those involved in such fraud would be severely punished.

“Some companies used the trade channel to bring in hot money,” said Zhou Hao, a Shanghai-based economist at Australia & New Zealand Banking Group Ltd. SAFE’s investigation “will likely further cool down hot money inflows and commodity imports could slow as banks will likely conduct more careful checks on documentation.”

Industrial metals fell and the yuan weakened after the announcement. Copper slid as much as 0.5 percent and all main metals on the London Metal Exchange declined. Chinese banks have about 20 billion yuan ($3.3 billion) of exposure to companies caught up in a loan fraud probe in Qingdao, two government officials told Bloomberg in July.

SAFE identified the fake trade invoicing as part of a crackdown on the practice in 24 cities and provinces, Wu said. The news raised speculation that metals supplies may increase as stockpiles tied up in financing deals come back on the market.

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Looks like they are finally starting to find out what has been happening in the shadows. In addition to being an economic POWERHOUSE, China is starting to look like a big mega fraud POWERHOUSE.
Virtual currencies are worth virtually nothing.
http://thebluefund.blogspot.com
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