Local polic busted three large underground banks in the city of Shenyang, capital of northeast Liaoning Province, which involved transactions of won of the Republic of Korea, the Daily Economic News quoted the State Administration of Foreign Exchanges (SAFE) as saying.

On Aug. 10 Zhou Xiaochuan, governor of China's central bank, said for the first time that won of the Republic of Korea is in the basket of the currencies that will act as a reference for the Renminbi exchange rate.

After the announcement, the Industrial and Commercial Bank of China became the first domestic bank starting exchange service of won cashes, the newspaper reported.

Seven suspects were arrested and about 900,000 yuan (about 110,000 US dollars) in cash was seized in the case, with 200 bank accounts holding 2 million yuan frozen, it reported.

Source: Xinhua