Rush to complete money laundering, anti-terror laws

PUBLISHED : Friday, 23 September, 2005, 12:00am
UPDATED : Friday, 23 September, 2005, 12:00am

Beijing is speeding up the introduction of legislation designed to combat money laundering and the financing of terrorism, People's Bank of China vice-governor Xiang Junbo said yesterday.

Mr Xiang told a symposium in Beijing that the mainland had started drafting legislation on the prevention of money laundering in March last year and the finished version would be submitted to the National People's Congress Standing Committee for review when it was ready.

He said 'perfecting' the laws and regulatory systems would be the focus of the country's anti-money laundering work in the near future. The laws and regulations will include the Criminal Law, a new anti-terrorism law and a number of money laundering regulations for banks, insurance companies and securities firms.

He said Beijing would accelerate efforts to set up the country's first Anti-Money Laundering Monitoring and Analysis Centre and strengthen its crackdown on 'underground banks'.

The central bank vice-governor said China would strive to become a formal member of the global anti-money laundering body, the Financial Action Task Force (FATF), and ensure its financial institutions could serve as the 'first line of defence' in the war against money laundering.

China became a taskforce observer early this year.

Quoting official statistics, the China News Service said the People's Bank of China and the State Administration of Foreign Exchange had referred more than 1,500 suspected cases of money laundering to police for investigation. The police had cracked 51 of the cases, involving a total of 3.9 billion yuan.

The Asian Development Bank estimates that more than 200 billion yuan, or 2 per cent of national gross domestic product, is laundered on the mainland each year.

Mainland bank officials had earlier suggested that China would hope to become a FATF member this summer. Its president, Jean-Louis Fort, has said the monitoring body is keen to have China as a member but that an evaluation had shown the mainland was not ready.

The adoption of an anti-money laundering law is a prerequisite for FATF membership.