Anti-money laundering crackdown to shift onus to China banks
Mainland central bank set to require domestic lenders to flag more suspicious financial transactions as the anti-graft campaign develops
Mainland regulators have gone pretty easy on money launderers over the past few decades, regardless of whether they were shady tomato traders or government officials moving their families and fortunes abroad.
The central bank requires banks to tick off on a long list of money laundering checks when financing trade transactions, but little more.
They have not been required to look beyond a published set of checks and that has left open the opportunity for skirting the rules up until now.
That is set to change, however, as the People's Bank of China begins to assign more responsibility to banks in flagging suspicious transactions, Michael Thomas, North Asia director at Wolters Kluwer Financial Services, told the .
"You know exactly what's being looked for so you can avoid those things that get reported," Thomas said, referring to the current state of regulation. "But I think we'll see the prescriptive rules disappear and be replaced by guidance, putting the onus on financial institutions to report everything they ought to."
In January last year, the anti-money-laundering division of the PBOC issued a new set of rules meant to gradually move away from the current system.
