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| China Considers Anti-money Laundering Law |
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China is widening the net to monitor flows of illicit money in a bill drawn up to combat rampant money laundering and the crimes where the money actually comes from including smuggling and drug trafficking. The draft law on anti-money laundering was submitted to the Standing Committee of the National People's Congress (NPC), the top legislature, for first deliberation on Tuesday and is expected to be passed into law after three rounds of hearings, according to China's law-making procedures. "Money laundering has grown into a prominent problem in China in the wake of rising serious crimes such as smuggling, drug dealing and corruption," said Feng Shuping, deputy director of the Budgetary Work Commission of the NPC Standing Committee, who briefed the legislature on the draft law. According to the China Anti-Money Laundering Monitoring and Analysis Center, an office under the central bank and set up in 2004, it had forwarded 683 suspicious money laundering reports to the police by the end of 2005. This involved 137.8 billion yuan (US$17.2 billion) and over US$1 billion. The draft legislation, aimed at establishing an all-around monitoring system, has widened the track-down scope of suspicious money flows from the banking sector to cover insurance, securities and law firms, accounting agents and businesses like real estate, jewelry sales and auctions, she said. The bill would ensure these businesses held a data-base of clients' background information and it requires them to report any suspicious transactions to the money-laundering information center for analysis. The monitoring network also includes corruption and financial frauds. These profit-generating crimes lead to money laundering and other upstream crimes such as drug trafficking and smuggling. It's urgent to speed up anti-money laundering legislation as illegal money transactions have disturbed financial order and posed a threat to economic security and social stability. China's central bank issued the nation's first anti-money laundering regulations in March 2003, specifying the obligations of financial institutions, largely in the banking sector, to report unusual and large transactions. "The current legal framework to monitor anti-money laundering is not well-founded, having little effect and delaying the country's efforts to counter the crime," she said. A lawmaker involved in the legislation said it is difficult to predict how much "black money" is "washed clean" annually in China but there's a recognizable trend of money laundering spreading from developed to less-developed countries. "So the legislation is of crucial importance," said Yu Guangyuan, an official with the Budgetary Work Commission of the NPC Standing Committee. Motions on acceding to the Joint Convention on the Safety of Spent Fuel Management and on the Safety of Radioactive Waste Management, as well as the draft amendment to Partnership Law were also deliberated on Tuesday to the Standing Committee of the NPC. (Xinhua News Agency April 25, 2006) |
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