He didn't deceive a single person, yet laundered 10.4 billion NTD: The rise of the "financial processor" standard for money laundering on-chain in fraud syndicates.

A virtual coin Money Laundering case involving an amount as high as NT$ 10.4 billion has recently shocked the Taiwanese police. The suspect, a man with the surname Qiu, although not participating in any actual fraud, assisted the fraud group in laundering the illicit money abroad through the crypto world mechanism, earning an estimated profit of NT$ 70 million annually from commissions. This case not only set the highest record for Money Laundering amounts in Central Taiwan's history but also forced the police to re-examine the importance of the "porter" role in the fraud chain.

Not a scammer, but the key on-chain: The rise of "financial processors"

A man with the surname Qiu, in his 40s, from Hukou, Hsinchu, had previously conducted business in China and in recent years switched to specializing in "coin water treatment." After a six-month investigation, the police discovered that his account had a high overlap with the fund flows of multiple fraud cases' victims, and the transactions were filled with a large number of USDT transfers. Although he did not operate a fraud platform nor had any contact with the victims, he is indeed the most important financial flow node behind the fraud industry.

How to launder? Convert TWD to USDT, then evaporate from the chain.

What is most shocking about this case is its extremely sophisticated "on-chain Money Laundering process." According to online discussions, the scam group first lures victims to transfer money to specific accounts, and then Qiu or its members buy New Taiwan dollars in a one-to-one or one-to-many manner, quickly exchanging them for an equivalent amount of USDT. These USDT are then transferred through multiple wallets and cold wallets, sometimes using decentralized exchanges (DEX), and finally deposited into overseas exchanges to complete the withdrawal and laundering process. The entire process requires almost no identity accounts, making it discreet and difficult to trace. For the police, without cooperation from the exchanges, it is nearly impossible to find out where the money ultimately goes.

How did the scale of 10.4 billion come about? Water rooms have become standard equipment for scam groups.

According to the Criminal Investigation Bureau, from 2023 to 2024, Qiu processed approximately 324 million Tether coins, with an amount exceeding 10.4 billion New Taiwan dollars, and an average commission of about 1% per transaction, conservatively estimating an annual profit of at least 70 million.

This is not comparable to the scale of ordinary coin merchants. The police question whether there is a fixed cooperating fraud group behind it, or even a division of labor among overseas teams. Qiu may just be the "Taiwan end coin washing station," with support from other mechanisms for coin speculation, profit sharing, and transfer, forming a complete underground money laundering industrial chain.

Crime scene: cold wallet, notebook, unnamed account, all evidence.

When the police raided the residence of suspect Qiu, they seized luxury items including a Lamborghini Urus, a Lexus LM, million-dollar watches, hundreds of thousands in cash, and two Ledger cold wallets. Additionally, there were over ten copies of foreign passports and a notebook containing cryptocurrency codes and transaction amounts.

There are no names in the notes, only codes: "HK1→USDT25k", "PH→XMR8k", "TW→EX出". The police speculate that these are codes for domestic and foreign money flow paths, and have currently handed them over to money flow and on-chain analysis experts for assistance in restoring the flow of funds.

Legal Blind Spots: "I was just exchanging coins, I didn't cheat anyone" Should it be a crime?

The suspect Qiu did not deny the operational facts during the police interrogation, but argued: "I didn’t deceive anyone, I just exchanged coins." This statement led the investigators to ponder: As the criminal industrial chain becomes increasingly specialized, with tasks such as deception, money flow, withdrawal, and even technical support being outsourced, how should those who "move coins" be convicted? Although the current Money Laundering Prevention Act has regulations, there still lacks clear punitive basis for similar unlicensed OTC operators, on-chain anonymous coin transfers, etc.

This is not an isolated case, but rather a part of Taiwan's underground financial industry.

This incident opened the eyes of the police and exposed the institutional deficiencies in Taiwan's fight against Money Laundering involving crypto coins. Qiu's role is more like a "financial processor"; he is not the mastermind, but he is a crucial link connecting the upstream and downstream capital flows. In the future, as fraud groups no longer directly handle money and even Money Laundering can be outsourced, fighting fraud will no longer be about capturing fraud rings, but about cutting off the entire supply chain. And Qiu is just one of the many faceless "coin laundering factories."

This article states that he didn't deceive a single person, yet laundered 10.4 billion TWD: The rise of the "financial processor" as a standard for money laundering on the crypto world, first appeared in Chain News ABMedia.