China Fails to Effectively Combat Money Laundering Linked to Wildlife Crime, Report Reveals

A recent report by TRAFFIC has exposed the inadequacies of China’s anti-money laundering (AML) framework in combating wildlife-related crimes. The study found that China’s current AML laws and regulations are limited in their ability to effectively detect and prevent money laundering linked to illegal wildlife trade.

Limitations of China’s Anti-Money Laundering Framework

• Only seven crimes are currently considered predicate money laundering offenses in China, including smuggling, but not broader wildlife crimes such as poaching or illegal logging.
• China’s AML regulatory authorities rely heavily on reports from financial institutions, which limits their ability to track illicit financial flows related to wildlife crime.
• The country’s AML framework lacks active engagement with overseas financial institutions, making it difficult to trace or investigate the entire chain of illegal movement of money overseas.

Recommendations for Improvement

• Expand the scope of predicate criminal acts to include broader links to more wildlife-related crimes.
• Enhance inter-departmental communication and financial intelligence sharing.
• Improve judicial assistance mechanisms for international cooperation.

International Cooperation Crucial

The report also highlights the need for international cooperation to combat wildlife-related crimes. China’s efforts to combat illegal wildlife trade through financial investigation are constrained by its reliance on bilateral agreements and limited international police cooperation channels.

Draft Amendment on Anti-Money Laundering

A draft amendment on AML, currently under consideration in China, has been hailed as a crucial step towards strengthening the country’s AML framework and combating wildlife-related crimes. If enacted, it could raise China’s AML standards to international levels and provide greater tools for detecting money laundering linked to wildlife trafficking.

Experts Warn of Consequences

Failing to address these gaps could hinder China’s efforts to combat wildlife crime and undermine its reputation as a responsible player in the global fight against organized crime.

Quote from Anne-Marie Weeden, Senior Research Fellow at RUSI

“Countries everywhere, including China, who wish to combat wildlife crime using anti-money laundering techniques can learn from the valuable recommendations within this report.”