Focus on enforcement puts mainland under pressure to crack down on laundering
A bid by China to become a member of the global anti-money laundering body, the Financial Action Task Force (FATF), is likely to trigger a potent clampdown on illicit capital flows, observers warn.
The mainland is also currently drafting a new anti-money laundering law, a prerequisite for FATF membership, with stringent enforcement likely to be a key issue.
An inspection team from FATF visited the mainland last month, and an evaluation of the country is pending.
China is preparing to apply for formal membership, and has already sought observer status at the body, according to a Xinhua report last month.
A conference in March last year put the sum of cash leaving the country each year through illegal channels at 200 billion yuan, an amount equal to 2 per cent of the country's annual gross domestic product.
Suspect funds could include the proceeds of bribery, corruption, drug trading, smuggling, tax evasion and fraud.