Shanghai regulator busts US$2.7b in forex transactions this year
Analysts expect crackdown to continue as authorities try to stem capital outflows
Authorities in Shanghai have intervened in illegal foreign exchange transactions totalling US$2.7 billion this year, as part of a crackdown meant to stem “irregularities”, the top foreign exchange regulator said on Wednesday.
It had teamed up with Shanghai police in exposing the illegal transactions, the State Administration of Foreign Exchange (Safe) said on its website. It added that it had suspended three banks from selling foreign exchange, for being involved in cross-border capital transfers via counterfeit trades.
The regulator did not name the three banks, nor did it disclose whether the suspensions had been lifted.
China has in recent months ramped up its capital controls in a bid to keep money in the country as the yuan dropped to eight-year lows.
Ren Zhiyi, a partner at law firm Fangda Partners, said authorities were signalling that they would continue cracking down on illegal transactions that bypassed capital controls.