Financial Crime World

China’s Fight Against Wildlife Crime: AML Best Practices Hold Key to Success

Wildlife crime has been linked to money laundering for years, with a significant impact on the environment and biodiversity. In 2019, the United Nations General Assembly adopted two resolutions recognizing illegal wild species trade as a predicate offense for money laundering.

Limitations of Current AML Framework

Despite these efforts, China’s current anti-money laundering (AML) framework has yet to effectively tackle wildlife-related crimes. The country’s AML laws and regulations have several limitations:

  • Only seven crimes are considered predicate money laundering offenses in China, excluding broader wildlife crimes such as poaching and illegal logging.
  • The financial compliance system lags behind those of other countries, covering fewer high-risk sectors for money laundering.

Recommendations for Improvement

To combat wildlife crime effectively, the report by TRAFFIC recommends:

  • Strengthening public-private partnerships
  • Improving inter-agency collaboration
  • Conducting wildlife-related financial investigations
  • Emphasizing international cooperation

2021 Draft Amendment on AML

The 2021 Draft Amendment on AML could address many gaps in the existing law, raising China’s AML standards to international levels. The draft amendment:

  • Broadens organizations’ AML obligations
  • Emphasizes tackling money laundering through all industries

Recommendations for Lawmakers and Regulatory Authorities

To combat wildlife crime effectively, lawmakers are urged to:

  • Ensure the passage and enactment of the Draft Amendment on AML
  • Expand the scope of predicate criminal acts to include broader links to more wildlife-related crimes

Regulatory authorities should:

  • Enhance inter-departmental communication and financial intelligence sharing
  • Improve the mechanism of judicial assistance for requests from other countries

Recommendations for Law Enforcement Agencies

Law enforcement agencies should:

  • Improve awareness and capacity to identify and detect concealed illicit items
  • Conduct financial investigations utilizing international criminal justice channels
  • Enhance the ability of financial and non-financial institutions professionals to monitor and identify suspicious transactions in IWT cases