The case HMRC v Xing [2025] EWHC 2057 (Admin) involves a significant enforcement action targeting alleged underground banking and illicit financial flows linked to Chinese nationals in the UK.
06/08/2025
FREEZING ORDERS: Chinese couple's assets frozen without notice in underground banking investigation.
HM Revenue and Customs has been granted a property freezing order against Chinese nationals Cheng Xing and Yan Zhang in respect of three properties and a bank account valued at over GBP1.4 million in total.
HMRC alleges the pair are involved in Chinese underground banking and 'Daigou' transfers to launder funds of unknown origin, and sought the order without notice because of the risk of dissipation (HMRC v Xing, 2025 EWHC 2057 Admin).
Here's a breakdown of the key elements:
🧾 Case Summary
- Parties: HM Revenue and Customs (HMRC) vs Cheng Xing and Yan Zhang.
- Court: High Court (Administrative Division).
- Citation: [2025] EWHC 2057 (Admin).
- Order Granted: Property Freezing Order (PFO) without notice.
💰 Assets Frozen
- Three properties and one bank account.
- Total value: Over £1.4 million.
⚖️ Allegations
- HMRC alleges involvement in:
- Chinese underground banking networks;
- Daigou transfers (informal cross-border shopping and remittance); and
- Money laundering of funds with an unknown origin.
🚨 Legal Grounds for Freezing
- The order was granted without notice due to:
- Risk of dissipation of assets; and
- Concerns that the individuals might move or conceal funds if alerted.
🔍 Daigou & Underground Banking Context
- Daigou: A practice where individuals purchase goods abroad to resell in China, often used to bypass import duties or currency controls.
- Underground banking: Informal systems for transferring money across borders, often outside regulated financial channels.
📌 Implications
- This case reflects HMRC’s increasing use of civil recovery tools like PFOs to disrupt suspected illicit finance.
- It also highlights the UK’s focus on cross-border financial crime, especially involving non-resident nationals and complex asset structures.
SOURCE
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