The Hong Kong Monetary Agency (HKMA) says it has identified trade finance as the main focus for its anti-money laundering (AML) and countering financing of terrorism (CFT) efforts in 2015.
The territory’s financial sector watchdog has also warned that it is intent on a crackdown on money laundering this year, with a focus on Hong Kong’s smaller banks.
Trade-based money laundering is seen by the regulator to be a particular problem in financial crime.
Hong Kong has also been under sustained pressure from the US Treasury to crack down on trade-based money laundering.
The HKMA has been strengthening its resources for supervision, resulting in the formation of an anti-money laundering division last year.
“For 2015, the Hong Kong Monetary Authority will take more disciplinary and prosecution action against AMLO [Anti-Money Laundering and Counter-Terrorist Financing Ordinance] violations coupled with fines”, a partner in fraud investigations and dispute services at Ernst & Young, Yu Manhim told local media.
“We saw in the past year the Hong Kong regulator had on many occasions expressed strong messages of stricter controls and possible fines in cases of violation, so we believe the regulators will take stronger action,” he added.
While the bigger banks in Hong Kong and the mainland are co-operating with the authorities, this is less so with the smaller banks, said Julian Russell, a director of Hong Kong risk consultancy Pacific Risk. “If you want to launder money, choose a smaller bank,” he said.
Categories: Trade Based Financial crimes News