Revealed: number of suspicious financial transactions in Hong Kong more than quadruples in six years

Hong Kong’s financial system is groaning under a deluge of tens of thousands of suspicious financial transaction reports, the number of which has more than quadrupled over the past six years.

In 2017 the Joint Financial Intelligence Unit – which acts as a clearing house for reports of suspicious activity filed by banks and other financial institutions – received 92,115 reports of transactions with suspected links to money laundering or terrorist financing. In 2011, the corresponding figure was just 20,287.

Financial regulators and law enforcement agencies have, in part, attributed the huge rise to changes to the law introduced in 2012 which mandated a greater number of financial organisations and other entities to report suspicious activity. They also cite a growing awareness of the problem of dirty money and the need to make reports.

However, the figures – obtained by the South China Morning Post – also reveal a worrying slump in the number of people convicted of money laundering, prompting concerns that the city is under-equipped to deal with the problem.

They also show a varying degree of success in the ability of the authorities to restrain and seize the ill-gotten gains of the international criminal networks. In addition, the number of initial reports which end up being passed on to other agencies for full investigation is a tiny proportion of the total number of reports made.