As the Chinese economy continues to stumble, some wealthy families are working to move large sums of money out of the country. They are worried that the value of China’s currency will tumble further and that their savings will become less valuable.
As reported by the New York Times, to navigate past that country’s cash controls, individuals are asking friends and families to carry or transfer out fifty thousand dollars apiece, the annual legal limit in China. That means that a group of one hundred people can move five million dollars overseas.
The practice is called Smurfing, and yes, that’s named after the blue cartoon characters popular three decades ago. Over the past year, companies and individuals have moved nearly one trillion dollars out of China. Some methods are perfectly legal, like investing in real estate abroad or purchasing overseas businesses. Other methods are not legal.
Chinese custom officials caught a woman last year trying to leave the mainland with two hundred and fifty thousand dollars strapped to her body and hidden inside her shoes. The ongoing flight of capital from China threatens to further weaken the world’s second largest economy.