Financial Crime World

Anti-Money Laundering (AML) and Counter-Terrorist Financing (CFT) Measures in Macao, China

Macao, China has made notable progress in implementing AML/CFT measures, as outlined in its 2016 plan. However, there are still areas that require improvement to ensure the effectiveness of these measures.

Overall Assessment

  • Progress: Macao, China has demonstrated significant progress in implementing AML/CFT measures.
  • Gaps: The 2016 AML/CFT and Combating the Financing of Proliferation (CFP) plan does not provide adequate direction for law enforcement agencies to adopt a risk-based approach for money laundering investigations.

Risk Assessment

Private Sector Understanding of ML Risks

  • Law enforcement agency assessments indicate low risk of terrorism financing.
  • Private sector understanding of money laundering risks is generally sound.
  • However, there are gaps in the ability of officers to interpret intelligence value and use of financial intelligence unit information in predicate investigations.

Areas Requiring Improved Understanding of ML Risks

  • Real Estate Sector: Requires improved understanding of money laundering risks.
  • Junket Promoters: Requires improved understanding of money laundering risks.
  • Dealers of Precious Stones and Precious Metals: Requires improved understanding of money laundering risks.

Supervisory Authorities

Enhanced Procedures and Guidance

  • Supervisory authorities have enhanced procedures and guidance in line with the strategic plan.
  • The GIF’s central policy role and strategic intelligence support supervisors to monitor their sectors and raise private sector risk awareness.

Law Enforcement Agencies (LEA)

Investigations of ML

  • LEA investigations of money laundering generally do not match the risk profile, demonstrating a lack of translation of the risk-based approach into practice.
  • A new parallel financial investigations mechanism in the Judiciary Police (PJ) is a promising step, but progress is limited, with only five money laundering convictions.

Financial Intelligence Unit (FIU)

Operational Intelligence

  • The FIU operates effectively as an autonomous unit, with sound methods and tools to produce operational intelligence.
  • However, there are gaps in the ability of officers to interpret intelligence value and use of FIU information in predicate investigations.

Cooperation and Information Exchange

Moderate Improvements Required

  • Cooperation and information exchange work well among the GIF, supervisors, and LEA, with moderate improvements required for more effective use of financial and criminal intelligence.

Conclusion

The report highlights both progress and areas for improvement in Macao, China’s AML/CFT measures. While there have been significant advancements, gaps remain in risk assessment, LEA investigations, and cooperation among agencies.