The Effectiveness of China’s Anti-Money Laundering Policies

Abstract

It is a controversial issue as to how to assess the effectiveness of the Anti-Money Laundering (AML) regime on the global arena. Based upon around 9,000 questionnaires circulated to AML professionals and other related staffs at the branches of banking institutions and People’s Bank of China as well, this study has acquired first hand data from respondents, and come up with following key findings. For the effectiveness of the whole AML system, it is rated as “largely effective” in respects to China’s legislation, regulation and supervision, suspicious transaction monitoring and analyses, administrative investigation, yet, it is rated as “basically effective” in respect to money laundering prosecutions and convictions, international cooperation. For the financial intuitions’ compliance with AML regulations, it is rated as “largely effective” in respects to internal control, customer’s identification, large-value transaction and suspicious transaction reporting, the record-keeping of ID information and transactions. Statistically, 58.48％ respondents think that the China’s AML regime is “completely effective” or “largely effective”, 35.21％ think that it is “basically effective”, with the remaining 4.68％ “largely ineffective” or “completely ineffective”. In conclusion, some policy recommendations to enhance the effectiveness are proposed.