BOC Further Strengthens Anti-money Laundering

On January 9, BOC spokesman Wang Zhaowen introduced to the media about the latest measures BOC had taken to strengthen anti-money laundering. He said, in view of the increasingly severe situation in international money laundering and terrorist financing, the international society continuously strengthened the strike against money laundering and terrorist financing, and the financing regulatory authorities of countries adopted more strict and complicated regulatory requirements.

Bank of China recently issued a circular named Requirements on Further Strengthening Anti-money Laundering in Bank of China to all the branches for the purpose of preventing reputation risks, protecting the state interests and securing funds. The circular required all the branches to be fully aware of the importance, urgency, persistence and complexity of anti-money laundering, to improve the risk identification, assessment and monitoring mechanism and to enhance the level of anti-money laundering.

Wang Zhaowen told the reporters that, in this circular, BOC required all the branches and institutions to insist on the lawful and compliance principle in anti-money laundering, strictly abiding by relative laws and regulations, the regulatory requirements of the local jurisdiction as well as the provisions in relative international covenants.

All the branches should perform the regulatory obligations in anti-money laundering, and pay close attention to countries and regions, business and customers facing high risk of money laundering. No branches or institutions would be allowed to provide any financial service to such organizations or individuals as suspected of money laundering, terrorist financing or owning weapons of mass destruction.

All the branches and institutions should commit to improving the anti-money laundering system, and should prevent from being imposed to carry out those illegal activities. When processing business, , branches should sincerely report any large-amount or doubtful transactions, and keep the transaction record.

Moreover, the branches should follow the account opening procedures, and improve the customer identification system so as to exactly know about your customer . The circular had also stipulated the working regulations on international settlement business, personal banking, bank card business and the clearing and collection business.

The spokesman emphasized that, in order to put the anti-money laundering work into operation, Bank of China had improved the management mechanism of anti-money laundering from the following seven aspects:

1. Clarifying the organizations and responsibilities. Bank of China Working Committee on Anti-money Laundering is responsible for establishing policies, rules and regulations on anti-money laundering, evaluating the efficiency of the anti-money laundering system, taking measures to strengthen anti-money laundering work, and supervising over the execution and performance of relative policies, rules and regulations and measures.

Departments of the Head Office are responsible for establishing working instructions on relative services, and directing institutions to put the anti-money laundering work into practice. The institutions should strictly implement the policies, regulations and instructions constituted by the Head Office, and intensify the responsibility system for anti-money laundering.

Chiefs of institutions are the first responsible person for anti-money laundering work, and should charge the organization and execution of anti-money laundering work within his scope of management.

2. Improving management mechanism on anti-money laundering and paying attention to the risk prevention when developing new products. The anti-money laundering work should be included into the scope of risk management. An effective management mechanism should be established to identify, evaluate and monitor the anti-money laundering risk.

Special attention and control should be given to the countries or regions, customers and products facing high anti-money laundering risks, which should be eliminated during development and realization of new products. A risk verification and assessment procedure should be established to regularly identify, evaluate and audit the potential risks during the designing, developing, approving and realization of new products.

3. Strengthening the audit and inspection on anti-money laundering activities. Bank of China would strengthen regular inspection and audit, improve the frequency of audit and take anti-money laundering work as the routine audit project.

4. Improving IT content in anti-money laundering. Bank of China would upgrade all the identification and indexing functions of the anti-money laundering modulus in the existing clearing system. The blacklist indexing function would be loaded to the teller s system, so that the teller may index and sort out the name list of any country, institution and individual where sanction is imposed, thus, improve the ability in anti-money laundering.

It would be deployed and considered carefully in the implementation of IT blueprint so as to continuously and stably improve the monitoring of anti-money laundering.

5. Stressing on the training of anti-money laundering skills. An anti-money laundering training plan would be imposed on all the staff. The staff shall attend at least one training every year, and the operators shall attend at least two trainings every year. The new staff shall attend the training on basic knowledge about anti-money laundering. In this way, the employees would improve their consciousness and ability in anti-money laundering.

6. Implementing the evaluation, rewards and punishment system. The implementation of anti-money laundering work would be included into the performance evaluation system of institutions. Employees violating any regulations on anti-money laundering shall be punished according to the Punishment Measures for Violations of Employees.

7. Adjusting the monitoring measures of the Group. Bank of China would unify, collect and share the anti-money laundering information, dynamically adjust and update the policies, further regulate the inter-bank enquiries and establish an emergency mechanism of anti-money laundering. Bank of China would strengthen the communication with the regulatory authorities so as to get their prompt direction, support, understanding and protection.

He also pointed out that, anti-money laundering was not only the requirement of maintaining the national financial safety, but also an objective demand of the bank itself for stable operation. This was a long-term task and could not be accomplished within one action. Hence, Bank of China must continuously carry on anti-money laundering.