Taiwanese crypto exchange and VASP member Bitgin is under investigation for money laundering.

Taiwanese cryptocurrency exchange Bitgin is under investigation by the country's police for money laundering. According to local news reports earlier this week, the company's chief operating officer, Yuting Zhang, was arrested by Taiwanese police on charges of money laundering at “Eighty Eight Gurd Hall”.

Earlier, local businessmen Zemin Guo and Chengwen Tu were accused of using their foreign exchange bureaus and cryptocurrency exchange accounts to launder billions of dollars in offshore fraud. Tu is accused of defrauding the country's tax authorities by claiming 300 million New Taiwan dollars ($9.28 million) in fraudulent export tax refunds on foreign video game credit sales.

Taiwan currently does not have an official licensing system for cryptocurrency exchanges. In September, Bitcoin, along with its industry peers, created the virtual asset service provider's Preparatory Office to help regulate itself and lobby political officials. Regarding the event, Yuling Chi, General Counsel of the Taiwan VASP Association, said:

“At this time, a member of the preparation team was involved in the investigation. The preparation team immediately held a meeting and made a public response. The members involved in the case also took the initiative to stop the work of the preparation team.

In a statement on November 13, the exchange said that the operations are “normal and user rights will not be affected.” According to Bitjin, Chief Operation Officer Zhang was involved in the eighty-eight guild hall money laundering scandal from 2021 to March 2022. However, Bitjin said Zhang cut all ties with his associates after learning of the money laundering allegations.

“Currently, Bitcoin is fully cooperating with the investigative department and actively providing all the necessary assistance to ensure the smooth operation of the investigation, and hopes that the facts can be clarified as soon as possible.”

Related: Taiwan's Financial Regulatory Commission Licenses First Secured Token