Financial Crime World

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Financial Watchdog Steps Up Anti-Money Laundering Efforts

The government has announced a series of measures to strengthen its anti-money laundering (AML) efforts, aiming to prevent financial crimes and combat terrorism financing.

New Regulations

Under the new regulations, financial institutions and designated non-financial businesses or professions will be required to establish a system for identifying and reporting suspicious transactions. The system must include procedures for:

  • Verifying customer identity
  • Monitoring transactions
  • Reporting suspicious activities to the authorities

The central competent authorities in charge of the relevant industries will conduct regular inspections of the implementation of these systems and may delegate the inspections to other agencies or organizations. Violations of the requirements may result in fines ranging from NT$500,000 to NT$10 million for financial institutions and NT$50,000 to NT$1 million for designated non-financial businesses or professions.

Reporting Suspicious Transactions

Financial institutions and designated non-financial businesses or professions will be required to report suspicious transactions to the authorities within a specified timeframe. Failure to do so may result in fines of up to NT$2 million.

Cooperation with Foreign Governments

Taiwan will strengthen its cooperation with foreign governments and international organizations to combat money laundering and terrorism financing. The government has announced plans to:

  • Enter into treaties or agreements with foreign governments, institutions or international organizations on combating money laundering, based on the principle of reciprocity
  • Provide information concerning declarations, reports or investigation results gathered under the AML regulations to foreign governments, institutions or international organizations upon request, based on the principle of reciprocity
  • Establish a mechanism for sharing intelligence and cooperating with foreign law enforcement agencies to combat money laundering and terrorism financing

Fines and Penalties

The new regulations provide for fines and penalties for individuals and entities involved in money laundering activities. Anyone found guilty of money laundering may be sentenced to:

  • Imprisonment of up to seven years
  • Fined up to NT$5 million

In addition, anyone who accepts, possesses or uses property or benefits without a reasonable account of its origin, and whose income is obviously disproportionate to the size of the assets, may be sentenced to:

  • Imprisonment of at least six months and up to five years
  • Fined up to NT$5 million

Distribution of Confiscated Property

The Ministry of Justice will establish regulations governing the distribution of confiscated property resulting from AML efforts. The government may distribute such proceeds to:

  • Prosecutors’ offices
  • Judicial police agencies
  • Other government agencies assisting in the investigation of money laundering activity for official use

In cases where the property is recovered as a result of assistance or efforts by this government and foreign governments, institutions or international organizations, based on treaties or agreements concluded on the principle of reciprocity, the Ministry of Justice may return or share the property confiscated to or request for return or sharing from foreign governments, institutions or international organizations.

The new regulations are part of Taiwan’s efforts to strengthen its AML framework and to prevent financial crimes. The measures aim to protect the integrity of the financial system and to prevent the flow of illicit funds.