Spanish police raided the Madrid branch of the Industrial and Commercial Bank of China (01398.HK, 601398.CN) on Wednesday, arresting five of its directors as part of a probe into the suspected laundering of at least 40 million euros (US$44.5 million).
The bank is suspected of allowing money earned from smuggling, tax fraud and labor exploitation to be transferred “to China in a way that appeared legal”, French news agency AFP said, citing a police statement.
Police arrested five directors of the branch during the search, the EU police agency Europol, which supported Spanish authorities in their investigation, said in a separate statement.
The raid followed last year’s police operation aimed at busting Chinese gangs based in Madrid, who are suspected of smuggling huge amounts of goods from China.
The criminal groups allegedly deposited the money they earned in ICBC, which is accused of sending the funds to China without checking their origin as required by law.
After that operation, investigators uncovered other Chinese and Spanish criminal groups also suspected of using the bank to launder money.
Investigation showed the alleged money laundering had links to activities in France, Germany and Lithuania, the report said.
The police statement said a judge in Parla, a southern Madrid suburb where many Chinese wholesale stores are located, had ordered the search of the branch.
ICBC entered the Spanish market in January 2011 with the inauguration of its branch in Madrid. It opened a second branch in Barcelona a year later.
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