Article 10 of the Measures for the Administration of Customer Due Diligence and Preservation of Customer Identity Information and Transaction Records of Financial Institutions (Order [2022] No. 1 of the China Min banking and Insurance Regulatory Commission of the Chinese Banking and Insurance Regulatory Commission, hereinafter referred to as "Order No. 1"), which will be implemented on March 1, stipulates that commercial banks, rural cooperative banks, rural credit cooperatives, village and township banks and other financial institutions shall identify and verify the identity of customers if they handle a single cash deposit and withdrawal business of more than 50,000 yuan in RMB or more in foreign currency equivalent to more than 10,000 US dollars for natural person customers. Understand and register the source or use of funds.
Order No. 1 was jointly issued by the Chinese Minmin Bank, the Banking and Insurance Regulatory Commission and the China Securities Regulatory Commission.
This new regulation has increased the registration behavior of bank customers who have deposited and withdrawn more than 50,000 yuan in cash, why "superfluous"? Will it affect the convenience of residents' normal cash deposit and withdrawal business? Will the customer's personal information and privacy be violated?
"Redundant" is for anti-money laundering
The responsible person of the relevant departments and bureaus of the People's Bank of China recently clearly responded that the relevant provisions on personal cash deposit and withdrawal are aimed at preventing and curbing illegal and criminal activities such as money laundering and protecting the safety and interests of the people's funds, and at the same time, the relevant regulations will not affect the normal cash deposit and withdrawal business of residents, and the convenience of residents' access to cash will not be affected.
The above-mentioned person in charge explained that under normal circumstances, financial institutions do not need customers to fill in information or provide supporting materials, financial institutions can directly handle cash access business for customers and register relevant information after a simple inquiry and understanding, and only when the transaction is found to be obviously abnormal and there are reasonable reasons to suspect that the transaction is suspected of illegal and criminal activities such as money laundering, it will further understand the situation to the customer.
Yan Lixin, associate professor of the School of Economics of Fudan University and director of the China Anti-Money Laundering Research Center, pointed out to Nandu reporters that monitoring and reporting large cash transactions is actually an obligation that the central bank has required all financial institutions, especially banks, to fulfill since 2006, but this obligation has not actually been placed in front of the customers themselves.
"Each of us might as well recall that you needed to go to the bank to deposit more than $50,000 in cash in the past year? If there is not much or almost none, then this policy has little impact on you; if it is more, then you should ask yourself another question, that is, in today's highly frequent and widely used mobile payments such as WeChat Pay and Alipay Payment, why do you need to deposit and withdraw large amounts of cash frequently? If the business activities you are engaged in have their own special characteristics and have to use a lot of cash, but they are legal, then you don't have to worry at all, you can fill in the report normally, and if you are involved in illegal acts or activities, then you really should worry. Yan Lixin said.
Refer to the international standard of 50,000 yuan "threshold"
Nandu reporter noted that as early as June 2020, the central bank issued the "Large Cash Management Pilot Plan", proposing to carry out large cash management pilot work in Hebei Province, Zhejiang Province and Shenzhen City for a pilot period of 2 years. The starting point for the management amount of public accounts is 500,000 yuan; the starting point for the management amount of private accounts is different, 100,000 yuan in Hebei Province, 300,000 yuan in Zhejiang Province, and 200,000 yuan in Shenzhen City. When depositing and withdrawing cash above the starting amount, the customer is registered at the time of business.
In the relevant annex "Interpretation of the Policy of Piloting the Management of Large Amounts of Cash", the document mentions that "some developed countries generally regard large cash management as an important part of social governance and international cooperation, and adopt strict and tight control measures." To meet the needs of the current situation, the mainland urgently needs to strengthen the management of large amounts of cash, ensure reasonable demand, curb unreasonable demand, and curb the use of large amounts of cash to commit illegal crimes. ”
Yan Lixin said that the practice of large cash deposits and withdrawals, customers need to fill in the source and use of funds is the common practice of international anti-money laundering, and the reporting "threshold" of RMB 50,000 is actually for ease of operation, roughly referring to the international standard, that is, "10,000 US dollars or other foreign currencies equivalent to 10,000 US dollars".
The person in charge of the relevant departments and bureaus of the People's Bank of China said that from a statistical point of view, the number of cash deposit and withdrawal business of more than 50,000 yuan in the mainland at present only accounts for about 2% of the total cash access business, and the provisions of Article 10 of Order No. 1 generally have less impact on customers' cash business.
In the next step, the People's Bank of China will guide financial institutions to formulate implementation rules, and while conscientiously fulfilling their anti-money laundering obligations, they must strictly implement the minimum and necessary principles to understand the registered customer information. "Especially for groups that use more cash such as the elderly, financial institutions should take the initiative to provide more friendly and convenient services." The responsible person of the relevant department and bureau of the People's Bank of China said.
In addition, the People's Bank of China will continue to pay attention to and guide financial institutions to strictly implement relevant regulations, grasp the balance between risk prevention and service optimization, and strictly protect citizens' personal information and privacy. If personal information and customer privacy are leaked, the bank and its staff will bear legal responsibility, and if the circumstances are serious, they will also bear criminal liability.
The person in charge of the relevant department and bureau of the People's Bank of China said that in the more than 370,000 telecommunications fraud cases investigated by the public security organs in the past year, a prominent feature is that criminals use cash to be anonymous and difficult to trace, and prefer to use cash for trading activities. Financial institutions appropriately strengthen the management of cash deposit and withdrawal activities in accordance with the law, which is conducive to preventing illegal and criminal activities and protecting the fundamental interests of the broadest masses of the people.
Tens of millions of fines under "strong supervision"
According to the administrative penalty information published by the Hangzhou Central Branch of Chinese Min Bank on January 30, Zhejiang Wangshang Bank Co., Ltd. was warned and fined 22.365 million yuan for failing to perform customer identification obligations in accordance with regulations, failing to keep customer identity information and transaction records in accordance with regulations, failing to perform suspicious transaction reporting obligations in accordance with regulations, and trading with unidentified customers.
Nine other responsible staff members of the bank were punished accordingly, including the head of the anti-money laundering second-level department of the comprehensive risk management department and the head of the product innovation department, who were warned or fined between 50,000 yuan and 80,000 yuan.
Coincidentally, an administrative penalty information published by the Shanghai Branch of Chinese Minsheng Bank on February 7 also reflects the current situation of "strong supervision" in the field of anti-money laundering. Fast Money Payment Clearing Information Co., Ltd. was fined 10.04 million yuan for failing to perform customer identification obligations in accordance with regulations, trading with unidentified customers, and was ordered to make corrections within a time limit. The two relevant responsible persons of the company were fined 35,000 yuan and 85,000 yuan respectively.
Chinese Bank issued the "China Anti-Money Laundering Report 2020" (hereinafter referred to as the "Report") at the end of 2021, according to the introduction that in 2020, a total of 614 obligated institutions were inspected for anti-money laundering law enforcement, of which 87% were legal entities, 537 anti-money laundering violation institutions were punished according to law, the amount of fines was 526 million yuan, and 1,000 individuals were punished for violations, with a fine amount of 24.68 million yuan.
The "Report" believes that in 2020, the mainland has achieved remarkable results in combating money laundering crimes, and has achieved remarkable results in many fields such as anti-gang crime, anti-terrorism, anti-corruption, anti-narcotics, anti-tax evasion, and crackdowns on underground money banks, and has helped crack down on the number of suspected money laundering cases has increased significantly, and the number of cases pronounced on "money laundering crimes" in Article 191 of the Criminal Law has more than doubled year-on-year.
Specifically, in 2020, the China Anti-Money Laundering Monitoring and Analysis Center received nearly 11.8 billion large-value transaction reports from 4,319 reporting agencies, and 2,586,700 suspicious transaction reports, an increase of 6.5% and 57.96% respectively year-on-year. All branches of the People's Bank of China received a total of 16,926 key suspicious transaction leads; after screening, a total of 7,804 anti-money laundering investigations were carried out on 808 clues that needed further investigation and thorough investigation, down 29.31% and 14.82% year-on-year, respectively; and 5,987 clues were transferred to the investigation and supervision organs, an increase of 23.24% year-on-year.
Written by: Nandu trainee reporter Zhao Weijia sent from Shanghai
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