Exclusive: Major OTC traders on mainstream platforms involved in Shaanxi "pig killing case"

Wu said blockchain learned that recently OKEx's large OTC traders were involved in the "pig killing case" in Shaanxi and were investigated. Some users found that a large trader on the platform suddenly disappeared.

In early September this year, a resident in Yangling, Shaanxi, was defrauded of more than 500,000 yuan by a gang in the form of a "pig-killing scheme". After the incident, the Demonstration Zone Public Security Bureau immediately set up a special task force to investigate and collect evidence. The police of the special task force traveled more than 3,000 kilometers to Henan, Hunan, Anhui, Jiangsu and other places to collect evidence for the case. Through comprehensive research and judgment, they finally locked down the hiding place of the fraud gang.

On September 22, the task force arrested all seven suspects in the fraud den in an office building in Changzhou, Jiangsu Province. Seven computers, more than 30 mobile phones, more than 30 mobile phone cards, more than 60 bank cards, and more than 100 U-Shields were seized on the scene.

Although the amount was not large, the police found that about 500,000 yuan of fraudulent funds flowed into OKEx and were converted into digital currency through the OTC merchant, which led to the OTC merchant in Jiangsu being hunted down across provinces. Currently, the platform, police, and OTC merchants are continuing to cooperate in the investigation.

"Slaughtering pigs" refers to a type of fraud that uses online dating to induce stock investment, gambling, and other types of fraud. "Slaughtering pigs" is a name given by "practitioners" themselves, which refers to a long-term "pig farming" fraud. The longer the pigs are raised, the more ruthless the fraud. On December 16, 2019, the term was selected as one of the "Top Ten New Words in Chinese Media in 2019".

The authorities are launching a crackdown and clearance campaign on "pig killing schemes" in various places. The exchanges are also suspected to have been greatly affected and are carrying out rectification.

Huobi released an announcement on September 21, saying that recently some criminals have induced users to purchase digital assets through online dating and other means, and then withdraw the coins to fake platforms for "investment" (this type of fraud is generally called "pig killing" fraud). Therefore, multiple identification strategies and warning products are launched online. When users initiate high-risk withdrawals, they will be directly rejected for a single withdrawal; users who are highly suspected of being victims of pig killing will be directly restricted from OTC buying functions. If the buying function is restricted for such reasons, you can contact the platform customer service to lift the relevant restrictions.

Previously, Wu Blockchain exclusively disclosed that many OTC traders were included in the central bank’s “disciplinary list” and all bank cards under their personal identities stopped non-counter transactions, “and they are not allowed to open cards for five years, and are not allowed to open non-counter transactions for three years.”

Lawyer Xia Wei once pointed out that concealing and hiding the proceeds of crime and the profits from the proceeds of crime are the crimes that OTC traders are most likely to be implicated in. That is, if one knows that the money used to buy coins comes from a crime and still trades with the other party, he or she will be guilty of this crime.

According to an insider, in the case of the Shaanxi pig-killing scam, if the OTC traders can indeed prove that they received the stolen money by accident, there may be some room for explanation later.

The cryptocurrency money laundering method of fraudulent activities is to receive legal currency and then transfer it to cryptocurrency exchanges through bank cards, Alipay and other channels. It is difficult for exchanges to prevent it. In contrast, the banking system has more powerful risk control and user data. Therefore, it is more common in developed countries to first discover problems and conduct risk control at the banking and payment levels. At present, China's banking system is also cracking down on money laundering. From a certain perspective, this is good news for OTC merchants and exchanges, which can reduce the amount of black money flowing in and being accepted.

For exchanges, it is necessary to strengthen communication with regulators, banks, and payment channels to prevent black money as much as possible, and at the same time help platform OTC merchants communicate with regulatory fees to maintain the ecosystem. (Author: 21 Research; Editor: Colin Wu)

▼ ▼ ▼