Chinese National Arrested Illegally Entering The US With Over $28,000 Worth Of Gold Bars

If one goes by the official Chinese data, whereas in the summer of 2015 there was a massive capital outflow in the aftermath of the sudden yuan devaluation, recent months have been a paragon of stability despite the yuan trading on the wrong side of 7 for much of the past five months, and according to Goldman’s preferred gauge of FX flows, China experience a modest outflow of around US$9bn in June (vs. US$19bn inflows in May).

Alas, as the recent price action in gold and cryptos indicates, the scramble to circumvent China’s great capital firewall are accelerating, with the following example of smuggling making a clear case that China’s smart money is once again on the march.

According to an Aug 6 release by the US Customs and Border Protection, while conducting operations near Amity, Maine, U.S. Border Patrol Agents from the Houlton Border Patrol Station apprehended a 36-year-old Chinese national who was found to have illegally entered the United States from Canada.

On Tuesday, August 4, agents from the Houlton Border Patrol Station encountered a female subject who admitted to being a Chinese national illegally present in the United States. Agents were able to verify the location where she illegally entered the United States by matching foot prints belonging to the suspect the scene. The individual was also in possession of nearly $10,000 U.S. Dollars (USD) and 14.25 ounces of gold bars valued at over $28,500 USD.  The Chinese national was placed under arrest for illegal entry into the United States and transported to the Houlton Border Patrol Station for further processing.

During processing it was found that the Chinese national had legally entered Canada as a student.  She also admitted to knowingly entering the United States illegally at a place other than a designated port of entry with the purpose of visiting a friend in San Francisco, California. The Chinese national was subsequently expelled to Canada in accordance with title 42 U.S. Code 265.

“The vigilance, service and integrity of our Border Patrol Agents who continue to apprehend those who are looking to circumvent customs and immigration laws, plays an important role in keeping our communities in Maine and throughout the United States safe,” said Houlton Station Patrol Agent in Charge Brent Conley.

More importantly, the fact that the Chinese are once again smuggling gold into the US confirms that while not apparent in the official data, capital flight out of China has once again picked up and will likely accelerate especially if the new Cold War between the US and China accelerates into the election. And, if it becomes too substantial, Beijing will have no choice but to reflect as much in the “official” data which would spark a feedback loop of even more capital outflows, even more aggressive clampdowns on money laundering, and an even greater propensity by the Chinese to buy fiat alternatives such as precious metals and crypto.