Chinese Underground Banks and Their Connections With Crime

Abstract

Chinese informal fund transfer systems (IFTS), widely known as underground banks, are one of the two prototypes of unregulated practices of fund transfer which could either use or bypass conventional banking institutions. This article focuses on the type of underground banking systems which primarily deals with foreign exchange and remittance transfer. The article proposes that underground banks are treated as illegal enterprises instead of a component of organized crime. This first qualitative study draws firsthand evidence from interviews made both in mainland China and in the United States. By depicting and analyzing the links of Chinese IFTS to human smuggling and money laundering, this article examines the extent to which the systems are involved in crime.

Financing China's engagement in Africa: new state spaces along a variegated landscape

“…Moreover, the financial hub has assumed another important role, albeit one hidden from view. An area of potential but difficult research lies in the ‘underground native banks’ ( dixia qianzhuang ), a term used to describe informal sources of capital that can be linked to organized crime engaged in global money laundering, human trafficking and usury (Zhao 2012). A great deal of their capital originates in Wenzhou, an enterprising region in coastal south-east China known for the global spread of its Christian-based business networks (Cao 2011; 2017).…”

Even So, Remember Me

“…155 The main destinations for these migrants were New York and San Francisco due to the established Chinese diasporas in those areas. 156 Snakehead smuggling operations to North America were observed across land, sea, and air, as opposed to Australia, which was predominantly a maritime operation. 157 Due to the sheer immensity of arrivals into North American, the authorities did not have resources or facilities capable of processing them.…”