Taiwanese man arrested for illicit USDT use, first case under new AML laws

Taiwanese authorities have apprehended a 30-year-old man, identified as Chen, for operating as an unregistered virtual currency trader under new anti-money laundering regulations.

Chen, based in Kaohsiung, had used Facebook groups to solicit cryptocurrency trades and arrange in-person transactions where he traded Tether (USDT) for money.

Despite the new law, Chen reportedly made hundreds of trades in less than a month, selling 400,000 USDT and earning NT$800,000. Police arrested him on December 24 and seized computers, cell phones, cash registers and safes as evidence.

This is the first case of this type since Virtual Asset Service Provider recording system became effective on November 30, 2024, according to local media The Liberty Times.

The system, mandated by the Prevention of Money Laundering Act, prohibits unregistered entities from offering virtual asset services.

Unregistered coin dealers

In another raid, authorities targeted an unregistered “coin dealer studio” on Chengdu Road in Taipei. The operation, run by employees named Lin and Liu, sold USDT at a 10% premium.

Investigations revealed that the studio generated more than NT$200 million in sales last month, generating a profit of NT$20 million, or about $600,000. Studio employees reportedly received NT$40,000 per month.

The Financial Surveillance Commission pointed out that only 26 registered entities are authorized to provide virtual asset services. Engaging in illegal currency trading can result in penalties, including up to two years in prison or fines of up to NT$5 million.

Authorities have increased monitoring online platforms to identify illicit transactions and urging the public to transact only with approved providers.