Bitgen under scrutiny for money-laundering

money laundering

Bitgen, a Taiwan-based cryptocurrency exchange, is under fire from the local police authority for money laundering.

According to Abmedia, a local news outlet, Bitgen’s COO Yuting Zhang was arrested by the police force for his potential role in the money laundering, also referred to as the “Eighty-Eight Guild Hall” incident.

As part of the incident Zhemin Guo and Chengwen Tu, two businessmen in the area, were charged with a multi-billion-dollar scheme. They were accused of using foreign exchange office and cryptocurrency exchange accounts as part of a money laundering effort to move funds from overseas. Tu has also been accused of fraudulent claims, by claiming $9.28 million worth of New Taiwan Dollar in fraudulent export tax refunds.

What is Taiwan’s crypto regulation?

As it stands, Taiwan has no official licensing for cryptocurrency exchanges to operate. With others in the industry, Bitgen created the Virtual Asset Service Provider Preparatory Office (VASP) as part of an effort to self-regulate and lobby political officials. Yuling Tsai, the general counsel of the Taiwan VASP Association, noted:

“This time, a member of the preparatory group were involved in the investigation case. The preparatory group immediately held a meeting and issued a public response. The members involved in the case also took the initiative to suspend participation in the work of the preparatory group.”

What is happening with Bitgen?

On Monday, Bitgen stated that operations are “normal” and that user rights would not be affected. According to the firm, upon the discovery of any money laundering allegations of Zhang, any and all communication was ceased between the COO and the firm.

“At present, Bitgin is fully cooperating with the investigating unit and actively providing all necessary assistance to ensure the smooth conduct of the investigation and hopes that the facts can be clarified as soon as possible.”

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