China

New Documents

The Standing Committee of the 13th National People’s Congress of China voted and passed the “Data Security Law of the People’s Republic of China,” which takes effect on Sept. 1, 2021.

The Chinese government issued a law concerning sanctions against foreign countries that interfere in China’s internal affairs or take restrictive measures against Chinese citizens and organizations.

Enforcement Actions

The Securities and Futures Commission issued a disciplinary action against the Hong Kong-based subsidiary of The Goldman Sachs Group, Inc., requiring it to pay a $350 million fine for serious supervisory, risk, compliance and anti-money laundering controls deficiencies.

The Hong Kong Securities and Futures Commission issued an order banning Joanna Chu Lai Wa, former director and responsible officer of Shenzhen, China-based Guosen Securities (HK) Brokerage Company, Limited for her failure to implement adequate AML/CTF controls.


Important Facts

  • The U.S. State Department labels China as a major money laundering country. The main sources of criminal proceeds include corruption, drug and human trafficking, smuggling, economic crimes, intellectual property theft, counterfeit goods, crimes against property, and tax evasion. Common methods laundering are bulk cash smuggling, trade based money laundering, the use of shell companies, invoice manipulation, high-value asset purchases, investing illicit funds in lawful sectors, gaming, and exploiting formal and underground financial systems and third- party payment systems.  Chinese authorities have also identified illegal fundraising activities, cross-border telecommunications fraud, weapons of mass destruction proliferation finance and other illicit finance activity linked to North Korea. In addition, new money laundering methods have been tied to corruption in the banking, securities and transportation sectors.  China has comprehensive know-your-customer and suspicious transaction reporting regulations that require financial institutions to determine and monitor the risk levels of customers and accounts, including foreign politically exposed persons.
-Source: 2020 International Narcotics Control Strategy Report (INCSR)

Rankings

FATF i | 2013 Methodology

Technical Effectiveness
Compliant : 7 High : 0
Largely Compliant : 18 Substantial : 3
Partially Compliant : 9 Moderate : 4
Non-Compliant : 6 Low : 4

Pakistan's technical compliance was re-rated in a Oct. 1, 2020 follow-up report

BASEL i

Rank : 18/141
Score : 6.76/10

TRANSPARENCY INTERNATIONAL i

Rank : 80/180
Score : 41/100

Tax Justice Network i

Rank : 25/133
Score : 60/100