• Fri
  • Jul 25, 2014
  • Updated: 5:31am
BusinessMoney
CRIME

Money laundering huge in Hong Kong and Macau: crime survey

PUBLISHED : Tuesday, 04 March, 2014, 11:38pm
UPDATED : Wednesday, 05 March, 2014, 11:58am

Money laundering is more prevalent in Hong Kong and Macau than in most parts of the world, with rates far above the global average, according to an economic crime survey by PwC.

A poll by the accounting firm found 37 per cent of companies in Hong Kong and Macau, mainly banks and casinos, had experienced money laundering in the past two years. That compared with a global average of 11 per cent, the Asia-Pacific average of 11 per cent, Singapore's 5 per cent and mainland China's 4 per cent.

Hong Kong had the highest reported rate of money laundering in Asia and the ninth highest globally, behind Britain, South Africa, the Czech Republic, Russia, Zambia, Australia, Kenya and Ukraine.

PwC polled 5,128 company executives from 95 countries and territories, including 116 respondents in Hong Kong and Macau, of whom 49 per cent worked for listed companies.

It was the first time the survey, which began in 2001, took a substantive look at money laundering in Hong Kong and Macau.

"The concentration of financial services in Hong Kong and gaming in Macau drives the significance of money laundering in the local marketplace," said John Donker, the lead PwC partner in forensic services for China and Hong Kong.

"The No1 concern found among financial services companies globally is money laundering. In Hong Kong, it is one of the top concerns."

PwC's poll found 27 per cent of financial services companies globally had experienced money laundering.

On Monday, a Hong Kong court found Carson Yeung Ka-sing, owner of English soccer club Birmingham City, guilty of laundering HK$721 million through Hong Kong bank accounts.

"It was refreshing to see a more substantive target prosecuted under the recent money laundering legislation," said Steve Vickers, chief executive of Steve Vickers Associates, a Hong Kong risk consultancy.

"It is important that targets are carefully selected to make sure the big fish, not the minnows, are selected."

The two previous major cases of money laundering in Hong Kong involved an elderly woman and a young man, and both of them received prison terms, Vickers noted.

A new law against money laundering and terrorist financing took effect in Hong Kong in 2012. Courts convicted 140 people of money laundering last year, 166 in 2012 and 246 in 2011. The government recovered HK$639.74 million of laundered money last year, HK$23.6 million in 2012 and HK$1.6 billion in 2011.

Share

For unlimited access to:

SCMP.com SCMP Tablet Edition SCMP Mobile Edition 10-year news archive
 
 

 

6

This article is now closed to comments

dynamco
Go to Macau VIP rooms-Buy chips with cash-Cash in the chips-Receive a bank draft-Use draft to buy property
Go to a jewellery store-buy millions of $ worth of jewellery & pay a storage charge in their vault- later return & sell the jewellery back to them at reduced price of course- use the Bank Draft to buy property
As a drugs cartel use a local solicitor to buy property in a Limited company name registered at the lawyer office – bring cases of cash to the solicitor or accountancy deposited in lots into a Trust fund – of course does not report it albeit obliged to do so
An acquaintance advertised his TaikooShing apartment for $8m-knock knock – 2 Mainlanders at the door offered to buy with cash. No way, for cash I want 10m he said. They went away. Next day came back with suitcases containing $10m.
In Hong Kong anything goes:
As a Mainland fraudster open an HK Bank account, advertise in Trade magazines & receive order deposits into (trustworthy) HK account – take the money + disappear in China – on complaint, HK police cannot find any genuine details of the person opening the account & no co-operation from PLA police on such cases
As a Zimbabwe despot or wanted Thai fugitive etc buy $45m properties in Hong Kong, circulate freely here even though a Red notice for the Thai is in place, sell the property in Kings Park hill
@US 3 million profit All perfectly acceptable to HK Govt
HK should reveal all Mainland owned property to Mainland authorities- honest buyers mo mantai
caractacus
Some HK banks query and report suspected money laundering and others, usually small, lesser known ones, launder hundreds of billions. That's how mainlanders swapped their holdall bags of dirty cash smuggled in via our more remote waterfronts such as Sai Kung, for bankers drafts to pay for residential property purchases.
How do you think that up to a couple of years ago between one third and 40% of HK residential properties were being bought by mainlanders? Were they caught and brought to book? No. Why? Well, who was benefitting? Answer the property developers who were big friends of Bow Tie and Hooray Henry. Who has replaced them now that CY Leung is out of favour with the property tycoons? Why, another gang of rapacious criminals called the H Y K who are C. Y. 's new big mates who he is allowing to run the N. T. and rape the country parks.
donniemcm
"mainland China's 4 per cent" that's pretty self explanatory !
In addition to John's remark about the presence of banks and casino, it's worth to mention that the "Free" country that is hong kong allows all those transactions.
And what is frightening is that 37% of company in HK is just the tip of the iceberg ...
lisagee
If these figures represent reports of money laundering then surely they show that HK is combating money laundering.
Will.I.Am
horacejeffry, you're wrong. Banks won't take millions of cash deposit, they charge you 0.25% for every $100,000 cash deposit. Anything more than a few hundred Ks and they start asking question, invoices, origin of money etc. and the slightest whiff of irregularities they sent you a letter to shut down your account, without needing to explain why they're discontinuing business with you or your company.
horacejeffry
As long as banks still take cash deposits of millions without asking questions HK will remain a banana republic on money laundring. That HK is that high in score is not strange with China as neighbours as a lot of the black money will come from there albeit not the only source
 
 
 
 
 

Login

SCMP.com Account

or