Beijing targets underground banks to stem outflows

Beijing will intensify its crackdown on the country’s underground banking system to stem illegal capital outflows, as part of its efforts to keep the financial sector in order, reports the South China Morning Post. State-level law-enforcement authorities and financial regulators are determined to root out illegal money transfers abroad that not only threaten China’s financial stability but also fuel criminal activities such as drug trafficking, terrorism and corruption, said Zhang Shenghui, chief of inspection department at the State Administration of Foreign Exchange (SAFE). His remarks came after a round of nationwide inspections that uncovered illegal deals worth more than 1 trillion yuan involving money transfers.