(Yicai Global) May 7 -- China’s foreign exchange regulator has named and shamed 24 financial institutions, companies and individuals for ignoring or seeking to flaunt the rules to get cash in and out of the country.
Tianjin Binhai Haitong Logistics Co. was a major offender, receiving a CNY11-million (USD1.7-million) fine for evading forex control policies, the State Administration of Foreign Exchange said in the circular that listed the culprits. Throughout 2015, the company fabricated transit trade transactions to pump USD46.5 million into foreign accounts using bills of lading that had already been filed by other companies.
Inbound payments were also a problem. The documents shows that Tianjin Haohua Minsheng Technology Development Co. received USD2 million as an advance payment from a customer for an export transaction that never took place. The move cost the company CNY200,000 (USD31,475) in penalties.
SAFE also criticized banks for failing to perform due diligence reviews on funds that they processed. It also advised that a number of individuals had abused their own and others’ annual foreign exchange quotas to illegally transfer assets overseas, with some of them wiring funds abroad via underground banks. Chinese nationals are permitted to convert the equivalent to USD50,000 a year into non-yuan currencies.