Hong Kong authorities, banking industry launch fraud, money-laundering task force

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Hong Kong’s police force, in collaboration with the Hong Kong Monetary Authority, the Hong Kong Association of Banks and a number of banks acting independently, have launched a 12-month pilot project aimed at “enhanc[ing] the detection, prevention and disruption of serious financial crime and money laundering threats”.

The Fraud and Money Laundering Intelligence Taskforce (FMLIT) was unveiled in a ceremony last week, at which the above photo, of deputy police commissioner Lau Yip-shing (left), executive director of enforcement and AML of the Hong Kong Monetary Authority Meena Datwani (middle) and acting chairperson of the Hong Kong Association of Banks Ann Kung (right) was taken.

In a joint statement, the organisations detailed how the new task force would address the problem of “financial crime”, by making use of an anti-money laundering and terrorist financing regime that the HKMA says the Hong Kong Government “has developed an over many years to protect the integrity of the financial system and citizens, and ensure that Hong Kong remains a safe and stable business environment”.

According to the statement, ten retail banks in Hong Kong have signed up to participate in the FMLIT, including Bank of China (Hong Kong), Standard Chartered Bank (Hong Kong), The Hongkong & Shanghai Banking Corp, Hang Seng Bank, Dah Sing Bank, Citibank (Hong Kong), DBS Bank (Hong Kong), The Bank of East Asia, Industrial and Commercial Bank of China (Asia), and China Construction Bank (Asia).

“FMLIT brings together, under one roof, the collective expertise and resources of government and industry to enhance the detection, prevention and disruption of serious financial crime and money laundering threats,” the statement, which may be viewed on the HKMA and Hong Kong Police Force websites, adds.

“A ‘Strategic Group’, comprising senior representatives from law enforcement, the regulator and the banking industry, will oversee FMLIT’s strategic direction and guide its work.

“At the core of FMLIT will be the Operations Group, where government and industry intelligence professionals will work side-by-side in tackling serious financial crime and money laundering threats impacting Hong Kong.

FMLIT reflects the determination of the government and the banking sector to work together in the global fight against serious financial crime and money laundering.”

The announcement of the anti-money-laundering and fraud task force comes as Chinese authorities have been seeking to crack down on the flow of money out of mainland China, and less than two months after the HKMA announced that it had “reprimanded” Coutts & Co’s Hong Kong branch for lapses in its compliance with anti-money-laundering regulations between 2012 and 2015, and fined it HK$7m (£721,720, US$900,720).

The Coutts operation in Hong Kong had been part of what had been Coutts’s international private banking and wealth management business, which it agreed in 2015 to sell to Switzerland’s Union Bancaire Privée. The deal, which resulted in a £200m goodwill write-down for RBS in 2015, completed in 2016.