Hong Kong stock and real estate markets have recently soared simultaneously. Experts believe it was caused by an influx of “hot money” from mainland China, and worry that it will lead to economic bubbles.
"Hot money" refers to funds that are controlled by investors who actively seek short-term returns. Often, hot money is laundered to “cool” it down, or make it appear legitimate.
The luxury housing market in Hong Kong has risen to as high as 712,800 Hong Kong dollars (US$91,930) per square meter. According to statistics from an intermediary organization, prices for luxury housing in Hong Kong this year have been restored to the level before the financial crisis, and have even exceeded the peak price before the 1997 Asian financial crisis.
An influx of hot money is one of the reasons causing high real estate prices, according to associate Professor Li Kui-Wai from the Department of Economics and Finance of the City University of Hong Kong.
”Many people say that the money came into Hong Kong from mainland China,” Li said. “Though China imposes control over foreign currency, many people are able to bring money [with them] when they come to Hong Kong. Some people say they basically bring money in bags. When someone buys a luxury house, they do not even need to consider a mortgage from a bank, as they would pay in full, in cash.”
Joseph Y.S. Cheng, a professor of political science at the City University of Hong Kong says a significant amount of the money comes from “disgraceful” sources.
“Hence, they want to seek a way out, and hope to transfer money out of China,” he said. “Under such circumstances, we see the wealthiest class in China sending their families to reside abroad, and then try to get a foreign passport, even multiple foreign passports. They also purchase real estate abroad as a way of retreat, and a kind of insurance.”
Cheng also described it as money laundering; “transferring money to somewhere where the Chinese regime does not have jurisdiction.”
“So we have indeed seen such people come to buy luxury housing in Hong Kong,” he said. “Their way of purchase is mostly paying by cash, or paying in one lump sum, unlike ordinary residents, who would buy through a long-term, ten- or twenty-year mortgage.”
The latest data shows that since the beginning of the financial crisis, the total amount of money flowing into Hong Kong has reached 532.6 billion Hong Kong dollars (US$68.69 billion), and is mostly traced to mainland China.
Sung Lap-kung, a program coordinator of the School of Continuing and Professional Education at the City University of Hong Kong, said that much of this hot money has entered Hong Kong from the Pearl River Delta area.
“Much of the hot money is from the 4,000 billion yuan (US$ 585.82 billion) stimulus fund, handed out from the Chinese government, at the end of last year and the beginning of this year,” Sung said. “Much of it has been released from the banks.”
Financial expert Lew Mon-hung said that mainland China’s total credit provided this year is close to 10 trillion yuan (US$1.46 trillion)—more than double the target set by the authorities.
“Some large state-owned enterprises are not short of money,” Lew said. “However, in order to fulfill their credit quota, the banks give many large state-owned corporations excessive amounts of money. They then invest them into the real estate market and the stock market; hence the inflow of hot money.”
Lew suggested that this sudden influx of hot money into Hong Kong is mainly due to distrust of the communist dictatorship.
“Though they used many capitalist ways to develop the economy, it is still under the banner of Marxism,” Lew said. “So people have concerns about this. Mainland China has a market economy that is distorted by power, particularly from the perspective of rule of law. Its law and rule of law do not match international standards.”
Lew said corruption was also a big problem. “Many links provide opportunities for these corrupt officials,” Lew said. “That is, they are eager for high credit quota, the higher the better for them. So as far as the politics is concerned: the GDP has increased; as far as individuals are concerned: they have more opportunities to seek money.”
“Of course there will be money laundering, which is a method of covering up one’s own economic crime,” Lew added.
Many financial experts and scholars are concerned whether such soaring prices in the real estate market will cause an economic bubble.
Once a large-scale outflow of capital occurs, it will impact Hong Kong's dollar interest rate and exchange rate, and the real estate price will drop accordingly. It is estimated that the pressure for lowering the real estate price will be greater and greater after December.
Source: The Epoch Times
Showing posts with label Hong Kong. Show all posts
Showing posts with label Hong Kong. Show all posts
on Tuesday, June 5, 2012
Ghana has been named as one of the countries whose citizens are stealing the identities of Australians.
News out in the Australian media say the theft which is in a large scale involves spies, drug dealers, illegal immigrants and people engaged in money laundering.
The report say passport details of five people emailed to a travel agent for travel for people from Ghana has been found.
One report by the Herald Sun citing documents from the country’s Department of Foreign Affairs and trade says the illegal practice of forging passports of living Australians is widespread.
According to the report, a fake or doctored Australian passport has been found, on average, once a week in the past three years.
Fake passports were detected at ports in countries including Britain, Dubai, Ghana, Thailand, Hong Kong, Indonesia, Malaysia, Egypt, Turkey, and Peru, the report indicated.
According to the report, some of the passports were in the hands of spies, smugglers and thieves.
Australian passports were used in 525 frauds in the last financial year, and many people were caught lying to get a passport, it said.
Source: Citifmonline
on Monday, May 28, 2012
The legal cases involving former policy secretary of Macao Special Administration Region (SAR), Ao Man Long, "won't drag on indefinitely" and "hopefully will be completed before too long", the SAR's Commissioner against Corruption, Cheong U, said at a press conference held here on Monday.
Cheong said that the SAR government has taken legal actions to reclaim Ao's ill-gotten wealth in Hong Kong and other places, but "its progress is not under our control".
Ao Man Long, the disgraced former secretary for transport and public works of the SAR, was sentenced by the SAR's Court of Final Appeal to 27 years in prison on 57 counts of corruption, money laundering, abuse of power and false declaration of assets. Ao is the highest-ranking SAR official ever convicted after the return of Macao to China.
Hong Kong media previously reported that Ao's ill-gotten proceeds and assets were worth 637 million HK dollars (81.7 million U.S. dollars) in 39 Hong Kong bank accounts and two safe deposit boxes, and 92 overseas bank accounts which were opened in the name of Ao, his father, fugitive wife, brother and sister-in-law.
Parts of the cases involving Ao was still under investigation and the total of Ao's ill-gotten wealth amounted to more or less 800 million patacas (103 million U.S. dollars), said the Commissioner. But he refused to disclose the details of these cases, saying he had to respect the confidential obligations of ongoing legal cases.
Last month, Ao's absconded wife was sentenced to 23 years on charges of money laundering and unjustified wealth. His younger brother, Ao Man Fu, was jailed for 18 years, while his brother's wife, Ao Chan Wa Choi, was given 13 years, both on money laundering charges. Ao's father, Ao Veng Kong, got 10 years for money laundering.
"Honestly, even one case like this is already too much for us and Macao," said the Commissioner, referring to the legal cases resulting from Ao's corruption scandal.
He also pointed out that it is high time that the SAR government and the local communities reflected on the cause of Ao's corruption scandal in the wake of his record long sentence.
Editor: Wang Hongjiang
Source: Xinhua
Cheong said that the SAR government has taken legal actions to reclaim Ao's ill-gotten wealth in Hong Kong and other places, but "its progress is not under our control".
Ao Man Long, the disgraced former secretary for transport and public works of the SAR, was sentenced by the SAR's Court of Final Appeal to 27 years in prison on 57 counts of corruption, money laundering, abuse of power and false declaration of assets. Ao is the highest-ranking SAR official ever convicted after the return of Macao to China.
Hong Kong media previously reported that Ao's ill-gotten proceeds and assets were worth 637 million HK dollars (81.7 million U.S. dollars) in 39 Hong Kong bank accounts and two safe deposit boxes, and 92 overseas bank accounts which were opened in the name of Ao, his father, fugitive wife, brother and sister-in-law.
Parts of the cases involving Ao was still under investigation and the total of Ao's ill-gotten wealth amounted to more or less 800 million patacas (103 million U.S. dollars), said the Commissioner. But he refused to disclose the details of these cases, saying he had to respect the confidential obligations of ongoing legal cases.
Last month, Ao's absconded wife was sentenced to 23 years on charges of money laundering and unjustified wealth. His younger brother, Ao Man Fu, was jailed for 18 years, while his brother's wife, Ao Chan Wa Choi, was given 13 years, both on money laundering charges. Ao's father, Ao Veng Kong, got 10 years for money laundering.
"Honestly, even one case like this is already too much for us and Macao," said the Commissioner, referring to the legal cases resulting from Ao's corruption scandal.
He also pointed out that it is high time that the SAR government and the local communities reflected on the cause of Ao's corruption scandal in the wake of his record long sentence.
Editor: Wang Hongjiang
Source: Xinhua
on Wednesday, May 23, 2012
Financial Action Task Force considers Hong Kong's measures to be effective, but could improve
While Hong Kong has a good legal structure to combat money laundering (ML) and terrorist financing (TF), measures taken to prevent such cases form occurring could be improved, according to a report by the Financial Action Task Force (FATF).
The FATF completed an assessment on the SAR last month, of the implementation of anti-money laundering and counter-terrorist financing (AML/CFT) standards in Hong Kong, coming to several conclusions about the city's ability to protect itself against underhanded monetary practices.
Amongst their findings, the FATF state that “Hong Kong has a good legal structure to combat money laundering (ML) and terrorist financing (TF)” with a broad offence that almost meets the FATF's requirements. They add that “it is well prosecuted with a satisfactory conviction rate.”
Yet, they point out that the TF does not “cover provision/collection for an individual terrorist or terrorist organisation” nor does the offence apply to non-financial assets or “extend to terrorism directed towards international organisations.”
Nevertheless, terrorist funds have not been detected in Hong Kong and there have been no prosecutions for TF.
And while Hong Kong “has a fairly comprehensive criminal confiscation regime,” this doesn't extend to all cases such as predicate offences. In addition, “legislative provisions enacted for confiscation of the proceeds of TF are not yet in force,” according to the statement.
Meanwhile, Hong Kong’s financial intelligence unit, the Joint Financial Intelligence Unit (JFIU), is considered effective.
Prevention takes the form of customer identification which applies to a range of financial institutions and some designated non-financial businesses and professions (DNFBPs) but is limited for non-core financial institutions.
According to the statement, “the preventive system for some non-core financial institutions does not incorporate adequate customer due diligence requirements with respect to politically exposed persons.”
And while the number of suspicious transaction reports (STRs) has increased, the submission of these reports by the DNFBPs could be improved.
Finally, Hong Kong's extradition regime is considered uncomplicated and “not subject to unreasonable grounds for refusal.”
Additionally, authorities are seen to provide a great deal of international cooperation as well as the facilitates to exchange “prompt and constructive exchange of information.”
Source: Macau Daily Times
While Hong Kong has a good legal structure to combat money laundering (ML) and terrorist financing (TF), measures taken to prevent such cases form occurring could be improved, according to a report by the Financial Action Task Force (FATF).
The FATF completed an assessment on the SAR last month, of the implementation of anti-money laundering and counter-terrorist financing (AML/CFT) standards in Hong Kong, coming to several conclusions about the city's ability to protect itself against underhanded monetary practices.
Amongst their findings, the FATF state that “Hong Kong has a good legal structure to combat money laundering (ML) and terrorist financing (TF)” with a broad offence that almost meets the FATF's requirements. They add that “it is well prosecuted with a satisfactory conviction rate.”
Yet, they point out that the TF does not “cover provision/collection for an individual terrorist or terrorist organisation” nor does the offence apply to non-financial assets or “extend to terrorism directed towards international organisations.”
Nevertheless, terrorist funds have not been detected in Hong Kong and there have been no prosecutions for TF.
And while Hong Kong “has a fairly comprehensive criminal confiscation regime,” this doesn't extend to all cases such as predicate offences. In addition, “legislative provisions enacted for confiscation of the proceeds of TF are not yet in force,” according to the statement.
Meanwhile, Hong Kong’s financial intelligence unit, the Joint Financial Intelligence Unit (JFIU), is considered effective.
Prevention takes the form of customer identification which applies to a range of financial institutions and some designated non-financial businesses and professions (DNFBPs) but is limited for non-core financial institutions.
According to the statement, “the preventive system for some non-core financial institutions does not incorporate adequate customer due diligence requirements with respect to politically exposed persons.”
And while the number of suspicious transaction reports (STRs) has increased, the submission of these reports by the DNFBPs could be improved.
Finally, Hong Kong's extradition regime is considered uncomplicated and “not subject to unreasonable grounds for refusal.”
Additionally, authorities are seen to provide a great deal of international cooperation as well as the facilitates to exchange “prompt and constructive exchange of information.”
Source: Macau Daily Times
on Monday, May 21, 2012
International anti-money laundering groups have praised Hong Kong's work against the crime and counter terrorist-financing regimes.
The comments were made in an evaluation report published today by the Financial Action Task Force on Money Laundering, and the Asia-Pacific Group on Money Laundering.
The report commended Hong Kong for its good legal structure and conviction rate for money laundering offences, clear and broad obligations for reporting suspicious transactions and strong law enforcement.
It said the city's supervisory regime over the banking, securities and insurance sectors is effective with comprehensive obligations and a broad range of sanctions, along with proactive and effective outreach to the private sector and international co-operation.
Hong Kong's formation of the Central Co-ordinating Committee on Anti-Money Laundering & Counter Financing of Terrorism chaired by the Financial Secretary was also a welcome development, it said.
On the report's suggestions for further improvements, the Security Bureau said it will formulate legislative proposals, enhance law enforcement in regulating remittance agents and moneychangers, and consult the industry.
As a taskforce member, Hong Kong is obliged to adopt the 40 recommendations for fighting money laundering and the nine special recommendations for combating financing of terrorism.
Source: Law & Order News
The comments were made in an evaluation report published today by the Financial Action Task Force on Money Laundering, and the Asia-Pacific Group on Money Laundering.
The report commended Hong Kong for its good legal structure and conviction rate for money laundering offences, clear and broad obligations for reporting suspicious transactions and strong law enforcement.
It said the city's supervisory regime over the banking, securities and insurance sectors is effective with comprehensive obligations and a broad range of sanctions, along with proactive and effective outreach to the private sector and international co-operation.
Hong Kong's formation of the Central Co-ordinating Committee on Anti-Money Laundering & Counter Financing of Terrorism chaired by the Financial Secretary was also a welcome development, it said.
On the report's suggestions for further improvements, the Security Bureau said it will formulate legislative proposals, enhance law enforcement in regulating remittance agents and moneychangers, and consult the industry.
As a taskforce member, Hong Kong is obliged to adopt the 40 recommendations for fighting money laundering and the nine special recommendations for combating financing of terrorism.
Source: Law & Order News
on Friday, May 11, 2012
By Heda Bayron
Hong Kong
20 September 2005
In a statement published Tuesday in major newspapers in Hong Kong and Macau, Banco Delta Asia said it had been engaged in business with North Korean banks and trading companies since the 1970's. But it called the U.S. Treasury Department's accusation that the bank is a money laundering conduit for North Korea "unfounded".
On Thursday, the Treasury Department designated Banco Delta Asia as a "primary money laundering concern" under the USA Patriot Act, which was passed in the aftermath of the September 11, 2001, terrorist attacks on New York and Washington.
The department said Banco Delta has been a "willing pawn" for North Korean agencies and companies to engage in "corrupt financial activities through Macau." It said the bank has met North Korea's needs and demands "with little oversight or control."
Stanley Au, the bank's chairman, told Hong Kong television the allegations are not true.
The bank says it will appeal the designation, and has announced that it has suspended all transactions with North Korean clients.
On Friday and Saturday, thousands of panicked depositors in Macau lined up to withdraw money from the bank.
In a bid to maintain public confidence, the Macau government appointed two independent bankers to help run Banco Delta Asia while it is under investigation. The Hong Kong Monetary Authority Friday also appointed a representative to manage a bank subsidiary in Hong Kong.
Joseph Yam, the head of the Hong Kong Monetary Authority, said Tuesday the investigation into the bank should proceed carefully in order to protect depositors.
The Treasury Department's Financial Crimes Enforcement Network has proposed a new rule that would prohibit U.S. financial institutions from dealing with Banco Delta Asia.
The department characterized Macau as a region in need of "significant improvement" in money laundering controls. The former Portuguese enclave reverted to Chinese sovereignty in 1999, and is best known for its booming gambling industry.
Source: VOA
Hong Kong
20 September 2005
In a statement published Tuesday in major newspapers in Hong Kong and Macau, Banco Delta Asia said it had been engaged in business with North Korean banks and trading companies since the 1970's. But it called the U.S. Treasury Department's accusation that the bank is a money laundering conduit for North Korea "unfounded".
On Thursday, the Treasury Department designated Banco Delta Asia as a "primary money laundering concern" under the USA Patriot Act, which was passed in the aftermath of the September 11, 2001, terrorist attacks on New York and Washington.
The department said Banco Delta has been a "willing pawn" for North Korean agencies and companies to engage in "corrupt financial activities through Macau." It said the bank has met North Korea's needs and demands "with little oversight or control."
Stanley Au, the bank's chairman, told Hong Kong television the allegations are not true.
The bank says it will appeal the designation, and has announced that it has suspended all transactions with North Korean clients.
On Friday and Saturday, thousands of panicked depositors in Macau lined up to withdraw money from the bank.
In a bid to maintain public confidence, the Macau government appointed two independent bankers to help run Banco Delta Asia while it is under investigation. The Hong Kong Monetary Authority Friday also appointed a representative to manage a bank subsidiary in Hong Kong.
Joseph Yam, the head of the Hong Kong Monetary Authority, said Tuesday the investigation into the bank should proceed carefully in order to protect depositors.
The Treasury Department's Financial Crimes Enforcement Network has proposed a new rule that would prohibit U.S. financial institutions from dealing with Banco Delta Asia.
The department characterized Macau as a region in need of "significant improvement" in money laundering controls. The former Portuguese enclave reverted to Chinese sovereignty in 1999, and is best known for its booming gambling industry.
Source: VOA
on Tuesday, May 8, 2012
The Anti-Corruption Commission Bill will be tabled in Parliament following its approval by the Cabinet yesterday, said Prime Minister Datuk Seri Abdullah Ahmad Badawi.
He said the bill would replace the Anti-Corruption Act and provide for the setting up of the Malaysian Commission on Anti-Corruption.
“The bill will be tabled for first reading in Parliament as soon as possible. God willing, when it is passed, it will be the foundation for the formation of an anti-corruption commission that is effective and subject to independent monitoring through a comprehensive check-and-balance system,” he said in his keynote address at the National Integrity Convention here yesterday.
Abdullah said he envisioned the commission to be staffed by experts in a wide range of fields such as forensic auditing for investigating commercial crimes.
“The Public Services Department is now in the final stages of preparing a new service scheme for the commission’s officers.
“This is important to help attract professionals and experts to serve with the commission,” he said.
He said the Cabinet also agreed to allow the commission to conduct its own administrative affairs including the hiring and firing of officers.
“I hope these steps will enhance the efficiency and effectiveness of the commission in carrying out its duties and responsibilities,” he said.
To further strengthen the commission, Abdullah said the Cabinet also approved the formation of two panels, one to evaluate its operation and the other on consultation and prevention of corruption.
“The operation evaluation panel will ensure that the commission’s actions and investigations are done transparently and responsibly.
“The panel on consultation and prevention of corruption will assist the commission in educating the public on fighting graft,” he said.
The Prime Minister also said the commission will be modelled on some of the best anti-corruption agencies in the world, including Hong Kong’s Independent Commission on Anti-Corruption and the Independent Commission Against Corruption in New South Wales, Australia.
It will be supported by a check-and-balance mechanism comprising an advisory board and a special committee on corruption to ensure its accountability, transparency and effectiveness.
Source: The Star
He said the bill would replace the Anti-Corruption Act and provide for the setting up of the Malaysian Commission on Anti-Corruption.
“The bill will be tabled for first reading in Parliament as soon as possible. God willing, when it is passed, it will be the foundation for the formation of an anti-corruption commission that is effective and subject to independent monitoring through a comprehensive check-and-balance system,” he said in his keynote address at the National Integrity Convention here yesterday.
Abdullah said he envisioned the commission to be staffed by experts in a wide range of fields such as forensic auditing for investigating commercial crimes.
“The Public Services Department is now in the final stages of preparing a new service scheme for the commission’s officers.
“This is important to help attract professionals and experts to serve with the commission,” he said.
He said the Cabinet also agreed to allow the commission to conduct its own administrative affairs including the hiring and firing of officers.
“I hope these steps will enhance the efficiency and effectiveness of the commission in carrying out its duties and responsibilities,” he said.
To further strengthen the commission, Abdullah said the Cabinet also approved the formation of two panels, one to evaluate its operation and the other on consultation and prevention of corruption.
“The operation evaluation panel will ensure that the commission’s actions and investigations are done transparently and responsibly.
“The panel on consultation and prevention of corruption will assist the commission in educating the public on fighting graft,” he said.
The Prime Minister also said the commission will be modelled on some of the best anti-corruption agencies in the world, including Hong Kong’s Independent Commission on Anti-Corruption and the Independent Commission Against Corruption in New South Wales, Australia.
It will be supported by a check-and-balance mechanism comprising an advisory board and a special committee on corruption to ensure its accountability, transparency and effectiveness.
Source: The Star
on Saturday, May 5, 2012
The Special Investigation Division of the Supreme Prosecutors Office on Friday listed a college classmate of former first lady Wu Shu-jen as a defendant for allegedly helping Wu with money laundering, increasing the number of defendants in the case to 12.
Prosecutor Chen Yun-nan, director of the division, confirmed that his division had summoned Wu's former classmate Tsai Mei-li for questioning as a defendant in the case, but said Tsai begged out of the session because she was ill.
Tsai's two brothers -- Tsai Ming-che and Tsai Ming-chieh -- have already been listed as defendants in the case for allegedly serving as proxies in helping the former first family launder money abroad.
In addition to Wu, three other members of the former first family -- former President Chen Shui-bian, son Chen Chih-chung and daughter-in-law Huang Jui-ching -- have all been listed as chief defendants in the money laundering case.
Others listed as defendants include the former first lady's elder brother Wu Ching-mao, his wife Chen Chun-ying, former Mega Financial Holding Co. Chairman Cheng Shen-chih, Yuanta Securities board member Tu Li-ping, and former Presidential Office cashier Chen Chen-hui.
None of those listed as defendants in the case have been indicted on charges related to money laundering, as at this stage in the investigation they are still only viewed as suspects.
Wu Ching-mao was released Nov. 28 on NT$2 million (US$59,580) bail after he had been held in custody for 53 days to prevent possible collusion among the defendants and witnesses.
Prosecutors who examined the information provided by judicial authorities of Singapore about an account owned by Wu Ching-mao believe they have enough evidence to suspect that Tsai Mei-li and her brothers helped the former first lady transfer millions of U. S. dollars illegally to her brother's account with South Africa's Standard Bank in Singapore through their bank accounts in Hong Kong.
Prosecutors found that they money was later wired to a Swiss bank account held by the son and daughter-in-law of the former president and his wife.
Before listing Tsai Mei-li as a defendant, the prosecutors questioned her four times. On Sept. 25, they searched her residence and office for possible evidence. Her brother Tsai Ming-che has been held in custody since Oct. 2.
In addition to their alleged violations of laws against money laundering, Chen Shui-bian and his wife also face investigation on charges of embezzling state affairs funds of the Presidential Office and accepting bribes during the former president's two terms between 2000 and 2008.
With the permission of the Taipei District Court, the Special Investigation Division has detained the former president since Nov. 12, after interrogating him for six hours a day earlier.
Source: Taiwan News
Prosecutor Chen Yun-nan, director of the division, confirmed that his division had summoned Wu's former classmate Tsai Mei-li for questioning as a defendant in the case, but said Tsai begged out of the session because she was ill.
Tsai's two brothers -- Tsai Ming-che and Tsai Ming-chieh -- have already been listed as defendants in the case for allegedly serving as proxies in helping the former first family launder money abroad.
In addition to Wu, three other members of the former first family -- former President Chen Shui-bian, son Chen Chih-chung and daughter-in-law Huang Jui-ching -- have all been listed as chief defendants in the money laundering case.
Others listed as defendants include the former first lady's elder brother Wu Ching-mao, his wife Chen Chun-ying, former Mega Financial Holding Co. Chairman Cheng Shen-chih, Yuanta Securities board member Tu Li-ping, and former Presidential Office cashier Chen Chen-hui.
None of those listed as defendants in the case have been indicted on charges related to money laundering, as at this stage in the investigation they are still only viewed as suspects.
Wu Ching-mao was released Nov. 28 on NT$2 million (US$59,580) bail after he had been held in custody for 53 days to prevent possible collusion among the defendants and witnesses.
Prosecutors who examined the information provided by judicial authorities of Singapore about an account owned by Wu Ching-mao believe they have enough evidence to suspect that Tsai Mei-li and her brothers helped the former first lady transfer millions of U. S. dollars illegally to her brother's account with South Africa's Standard Bank in Singapore through their bank accounts in Hong Kong.
Prosecutors found that they money was later wired to a Swiss bank account held by the son and daughter-in-law of the former president and his wife.
Before listing Tsai Mei-li as a defendant, the prosecutors questioned her four times. On Sept. 25, they searched her residence and office for possible evidence. Her brother Tsai Ming-che has been held in custody since Oct. 2.
In addition to their alleged violations of laws against money laundering, Chen Shui-bian and his wife also face investigation on charges of embezzling state affairs funds of the Presidential Office and accepting bribes during the former president's two terms between 2000 and 2008.
With the permission of the Taipei District Court, the Special Investigation Division has detained the former president since Nov. 12, after interrogating him for six hours a day earlier.
Source: Taiwan News
on Thursday, May 3, 2012
Two former managers of the Bank of China and their wives were convicted on Aug. 29, 2008, by a federal jury in Las Vegas on charges of racketeering, money laundering, international transportation of stolen property as well as passport and visa fraud, Acting Assistant Attorney General Matthew Friedrich of the Criminal Division and U.S. Attorney Gregory A. Brower of the District of Nevada announced today.
Xu Chaofan (a/k/a Hui Yat Fai), Xu Guojun (a/k/a Hui Kit Shun), Kuang Wan Fang (a/k/a Wendy Kuang) and Yu Ying Yi were convicted after being charged in the 15-count superseding indictment on Jan. 31, 2006. Sentencing is scheduled for Nov. 24, 2008.
Evidence presented during the trial established the elaborate scheme to defraud the Bank of China of at least $485 million, orchestrated by former managers Xu Chaofan, Xu Guojun and a third former bank manager, Yu Zhendong (a/k/a Yu Wing Chung) who pleaded guilty in connection with this investigation and cooperated with the United States.
According to information presented in court, the scheme involved efforts by the bank managers to launder the stolen money through Hong Kong, Canada and the United States, among other countries, and then immigrate to the United States from China with their wives by obtaining false identities and entering into sham marriages with naturalized U.S. citizens.
Evidence also proved that the bank managers' true wives, Kuang Wan Fang and Yu Ying Yi, assisted their husbands in laundering the proceeds of the fraudulent scheme and violated U.S. immigration laws by entering this country illegally and then securing U.S. citizenship and passports through fraudulent means. The indictment also charged Kwong Wa Po, who remains a fugitive.
All five defendants were charged with engaging in a RICO conspiracy that began in 1991 and continued until October 2004, when the former bank managers and their wives were arrested. The underlying racketeering activities included engaging in monetary transactions with stolen money, transportation of stolen money, passport fraud and visa fraud.
Evidence presented at trial established that the former bank managers created a number of shell corporations in Hong Kong and, with the assistance of others, funneled the bank's money into these companies as well as numerous personal bank and investment accounts. Assisted by their wives, relatives and others, the former bank managers then laundered the stolen proceeds through Canada and the United States.
Evidence presented at trial included a significant number of transactions with the stolen money through Las Vegas casinos, including bets at the casinos that ranged from $20,000 up to $80,000.
All five defendants also were convicted of engaging in a money laundering conspiracy and conspiracy to transport stolen money that began in 1998 and continued through October 2004. These conspiracy charges focused on the laundering of the stolen money in the United States not only through casinos, but also through numerous bank accounts established in the United States by the defendants.
The two former bank managers were also convicted on three counts each of visa fraud - specifically, the possession and use of a fraudulently procured non-immigrant U.S. visa to enter and/or remain in Las Vegas. The two bank managers' true wives were convicted of three counts each of passport fraud - specifically, the use of a U.S. passport secured through a false statement to enter or facilitate their stay in Las Vegas.
"Having embezzled nearly $500 million from a Chinese bank, these defendants turned to the United States as a place to hide themselves and their ill-gotten gains. This three month trial showed, through the testimony of 34 witnesses and approximately 500 exhibits, the lengths to which the defendants went to conceal their activities, including their use of false identities, sham marriages for immigration purposes, phony documents and nominee companies," said Acting Assistant Attorney General Matthew Friedrich. "Overseas offenders who turn to the United States as a safe haven, and who try to exploit our financial systems, can similarly expect to be prosecuted."
"The subjects convicted in this case attempted to elude law enforcement and use the United States as a haven for masking their criminal activities and illegal proceeds," said Kenneth W. Kaiser, Assistant Director of the FBI's Criminal Investigative Division.
"This elaborate scheme was investigated and disrupted thanks to the cooperation from our domestic and international law enforcement partners. We will continue to work together sharing intelligence information and conducting joint operations as prescribed in the Law Enforcement Strategy to Combat International Organized Crime of April 2008."
"These convictions are the culmination of a multi-agency effort to take down a sophisticated criminal enterprise that sought to exploit our immigration system and our financial regulations," said Julie L. Myers, Assistant Secretary of Homeland Security for ICE. "Our goal is to work with our law enforcement partners in the U.S. and around the world to identify and ultimately dismantle these organizations and ensure that the members face justice in the United States."
Defendants Xu Chaofan, Xu Guojun, Kuang Wan Fang and Yu Ying Yi were charged on Sept. 21, 2004, in an 11-count indictment with conspiring to violate, and substantive violations of, U.S. immigration law.
The third former bank manager, Yu Zhendong, pleaded guilty to engaging in a racketeering enterprise on Feb. 18, 2004, and voluntarily returned to China, where he was convicted for embezzlement for his role in the bank theft. Yu Zhendong's true wife, Yu Xuhui (a/k/a Fion Yu), pleaded guilty on April 26, 2005, to unlawfully procuring U.S. citizenship. She has agreed to voluntarily relinquish her American citizenship, but was permitted to remain in the United States with the couple's children as long as she does not commit another crime.
Yu Zhendong's fake American wife, Shanna Yu Ma (a/k/a Yu Shuzhan) pleaded guilty to submitting a false statement to the Immigration and Naturalization Service, now part of the Department of Homeland Security, in support of Yu Xuhui's application for naturalization. Both Ms. Ma and Ms. Yu were sentenced in December 2007 to terms of probation.
On April 23, 2008, Attorney General Michael B. Mukasey announced the Law Enforcement Strategy to Combat International Organized Crime to address the growing threat to U.S. security and stability posed by international organized crime. The strategy was developed following an October 2007 International Organized Crime Threat Assessment.
The strategy specifically reacts to the globalization of legal and illegal business, advances in technology, particularly the Internet, and the evolution of symbiotic relationships between criminals, public officials and business leaders that have combined to create a new, less restrictive environment within which international organized criminals can operate.
U.S. law enforcement must combat international organized criminals who are adept at using the globally connected financial system to launder their illegal proceeds in locations far from where the ill-gotten gains were initially generated.
Ultimately, the strategy aims to create consensus among domestic law enforcement in identifying the most significant priority targets and then taking unified and concerted action among domestic and international law enforcement in significantly disrupting and dismantling those targets.
International organized crime is defined as those self-perpetuating associations of individuals who operate internationally for the purpose of obtaining power, influence, monetary and commercial gains, wholly or in part by illegal means, while protecting their activities through a pattern of corruption and violence. International organized criminals operate in hierarchies, clans, networks and cells. The crimes they commit vary as widely as the organizational structures they employ.
This matter was prosecuted by Trial Attorneys Cynthia Stone and Krista Tongring of the Criminal Division's Organized Crime and Racketeering Section and Assistant U.S. Attorney Ronald Cheng of the U.S. Attorney's Office for the Central District of California. Organized Crime Strike Force Chief Eric Johnson of the U.S.
Attorney's Office for the District of Nevada served as local counsel. Significant assistance was also provided by Kyle Latimer of the Criminal Division's Office of International Affairs. The U.S. Attorney's Office for the District of Nevada provided significant support for the prosecution and coordination of witnesses from throughout the United States and overseas.
The case was investigated by the FBI's Las Vegas Field Office and U.S. Immigration and Customs Enforcement of the Department of Homeland Security. Essential support was also provided by the FBI's offices in Beijing and Hong Kong.
The government of the People's Republic of China, in particular the Ministries of Justice and Public Security along with the Hong Kong Department of Justice and Hong Kong Police Force, also provided substantial assistance in producing evidence and making witnesses available, both for testimony at trial and videotaped depositions.
Source: KVBC
Xu Chaofan (a/k/a Hui Yat Fai), Xu Guojun (a/k/a Hui Kit Shun), Kuang Wan Fang (a/k/a Wendy Kuang) and Yu Ying Yi were convicted after being charged in the 15-count superseding indictment on Jan. 31, 2006. Sentencing is scheduled for Nov. 24, 2008.
Evidence presented during the trial established the elaborate scheme to defraud the Bank of China of at least $485 million, orchestrated by former managers Xu Chaofan, Xu Guojun and a third former bank manager, Yu Zhendong (a/k/a Yu Wing Chung) who pleaded guilty in connection with this investigation and cooperated with the United States.
According to information presented in court, the scheme involved efforts by the bank managers to launder the stolen money through Hong Kong, Canada and the United States, among other countries, and then immigrate to the United States from China with their wives by obtaining false identities and entering into sham marriages with naturalized U.S. citizens.
Evidence also proved that the bank managers' true wives, Kuang Wan Fang and Yu Ying Yi, assisted their husbands in laundering the proceeds of the fraudulent scheme and violated U.S. immigration laws by entering this country illegally and then securing U.S. citizenship and passports through fraudulent means. The indictment also charged Kwong Wa Po, who remains a fugitive.
All five defendants were charged with engaging in a RICO conspiracy that began in 1991 and continued until October 2004, when the former bank managers and their wives were arrested. The underlying racketeering activities included engaging in monetary transactions with stolen money, transportation of stolen money, passport fraud and visa fraud.
Evidence presented at trial established that the former bank managers created a number of shell corporations in Hong Kong and, with the assistance of others, funneled the bank's money into these companies as well as numerous personal bank and investment accounts. Assisted by their wives, relatives and others, the former bank managers then laundered the stolen proceeds through Canada and the United States.
Evidence presented at trial included a significant number of transactions with the stolen money through Las Vegas casinos, including bets at the casinos that ranged from $20,000 up to $80,000.
All five defendants also were convicted of engaging in a money laundering conspiracy and conspiracy to transport stolen money that began in 1998 and continued through October 2004. These conspiracy charges focused on the laundering of the stolen money in the United States not only through casinos, but also through numerous bank accounts established in the United States by the defendants.
The two former bank managers were also convicted on three counts each of visa fraud - specifically, the possession and use of a fraudulently procured non-immigrant U.S. visa to enter and/or remain in Las Vegas. The two bank managers' true wives were convicted of three counts each of passport fraud - specifically, the use of a U.S. passport secured through a false statement to enter or facilitate their stay in Las Vegas.
"Having embezzled nearly $500 million from a Chinese bank, these defendants turned to the United States as a place to hide themselves and their ill-gotten gains. This three month trial showed, through the testimony of 34 witnesses and approximately 500 exhibits, the lengths to which the defendants went to conceal their activities, including their use of false identities, sham marriages for immigration purposes, phony documents and nominee companies," said Acting Assistant Attorney General Matthew Friedrich. "Overseas offenders who turn to the United States as a safe haven, and who try to exploit our financial systems, can similarly expect to be prosecuted."
"The subjects convicted in this case attempted to elude law enforcement and use the United States as a haven for masking their criminal activities and illegal proceeds," said Kenneth W. Kaiser, Assistant Director of the FBI's Criminal Investigative Division.
"This elaborate scheme was investigated and disrupted thanks to the cooperation from our domestic and international law enforcement partners. We will continue to work together sharing intelligence information and conducting joint operations as prescribed in the Law Enforcement Strategy to Combat International Organized Crime of April 2008."
"These convictions are the culmination of a multi-agency effort to take down a sophisticated criminal enterprise that sought to exploit our immigration system and our financial regulations," said Julie L. Myers, Assistant Secretary of Homeland Security for ICE. "Our goal is to work with our law enforcement partners in the U.S. and around the world to identify and ultimately dismantle these organizations and ensure that the members face justice in the United States."
Defendants Xu Chaofan, Xu Guojun, Kuang Wan Fang and Yu Ying Yi were charged on Sept. 21, 2004, in an 11-count indictment with conspiring to violate, and substantive violations of, U.S. immigration law.
The third former bank manager, Yu Zhendong, pleaded guilty to engaging in a racketeering enterprise on Feb. 18, 2004, and voluntarily returned to China, where he was convicted for embezzlement for his role in the bank theft. Yu Zhendong's true wife, Yu Xuhui (a/k/a Fion Yu), pleaded guilty on April 26, 2005, to unlawfully procuring U.S. citizenship. She has agreed to voluntarily relinquish her American citizenship, but was permitted to remain in the United States with the couple's children as long as she does not commit another crime.
Yu Zhendong's fake American wife, Shanna Yu Ma (a/k/a Yu Shuzhan) pleaded guilty to submitting a false statement to the Immigration and Naturalization Service, now part of the Department of Homeland Security, in support of Yu Xuhui's application for naturalization. Both Ms. Ma and Ms. Yu were sentenced in December 2007 to terms of probation.
On April 23, 2008, Attorney General Michael B. Mukasey announced the Law Enforcement Strategy to Combat International Organized Crime to address the growing threat to U.S. security and stability posed by international organized crime. The strategy was developed following an October 2007 International Organized Crime Threat Assessment.
The strategy specifically reacts to the globalization of legal and illegal business, advances in technology, particularly the Internet, and the evolution of symbiotic relationships between criminals, public officials and business leaders that have combined to create a new, less restrictive environment within which international organized criminals can operate.
U.S. law enforcement must combat international organized criminals who are adept at using the globally connected financial system to launder their illegal proceeds in locations far from where the ill-gotten gains were initially generated.
Ultimately, the strategy aims to create consensus among domestic law enforcement in identifying the most significant priority targets and then taking unified and concerted action among domestic and international law enforcement in significantly disrupting and dismantling those targets.
International organized crime is defined as those self-perpetuating associations of individuals who operate internationally for the purpose of obtaining power, influence, monetary and commercial gains, wholly or in part by illegal means, while protecting their activities through a pattern of corruption and violence. International organized criminals operate in hierarchies, clans, networks and cells. The crimes they commit vary as widely as the organizational structures they employ.
This matter was prosecuted by Trial Attorneys Cynthia Stone and Krista Tongring of the Criminal Division's Organized Crime and Racketeering Section and Assistant U.S. Attorney Ronald Cheng of the U.S. Attorney's Office for the Central District of California. Organized Crime Strike Force Chief Eric Johnson of the U.S.
Attorney's Office for the District of Nevada served as local counsel. Significant assistance was also provided by Kyle Latimer of the Criminal Division's Office of International Affairs. The U.S. Attorney's Office for the District of Nevada provided significant support for the prosecution and coordination of witnesses from throughout the United States and overseas.
The case was investigated by the FBI's Las Vegas Field Office and U.S. Immigration and Customs Enforcement of the Department of Homeland Security. Essential support was also provided by the FBI's offices in Beijing and Hong Kong.
The government of the People's Republic of China, in particular the Ministries of Justice and Public Security along with the Hong Kong Department of Justice and Hong Kong Police Force, also provided substantial assistance in producing evidence and making witnesses available, both for testimony at trial and videotaped depositions.
Source: KVBC
on Thursday, April 12, 2012
The Alpine principality will start helping other nations claw back missing tax revenues.
Timing is everything these days, especially for a tax haven like Liechtenstein. A day before finance ministers of the Group of 20 were due to meet to discuss new guidelines to stop tax evasion, one of the world’s favored destinations for such shenanigans said it would start helping other nations claw back their missing tax revenues.
The tiny Alpine principality said Thursday that it was dropping its distinction between tax evasion and tax fraud, an issue that has frustrated tax authorities in the United States and Germany because Liechtenstein previously insisted on only handing over data in cases of outright tax fraud.
It now says it has already begun “concrete talks” with other nations and was offering bilateral tax agreements in cases of tax fraud and tax evasion. "We are aware of our responsibility as part of a globally integrated economic area,” Prime Minister Otmar Hasler said. “With today's declaration, we are making our contribution to a joint solution that will make an effective enforcement of foreign tax claims possible.”
International organizations such as the Organization for Economic Cooperation and Development have been lobbying for more transparency from tax havens like Liechtenstein, Switzerland and Luxembourg for many years now. But the crackdown has now reached a critical stage as governments around the world seek to tighten financial regulations to prevent another repeat of the credit crunch while desperately trying find new tax revenues.
France and Germany have already asked the OECD to prepare information on tax havens for the G-20 meeting in London on April 2. On Tuesday, France’s La Tribune reported that the OECD was adding Switzerland, Luxembourg, Austria, Singapore and Hong Kong to its list of noncooperative tax centers, which already included Liechtenstein.
Stephen Platt, chairman of the BakerPlatt Group and specialist in anti-money-laundering, said that Liechtenstein’s move was “essential” to its ongoing survival. "It is simply untenable within this climate and this environment for centers to continue not to criminalize the laundering of the proceeds of foreign tax evasion," he said, adding that in the long term such rules were “unsustainable and not good for your reputation.”
But the international backlash against tax havens by governments and the G-20 may also be too indiscriminate, he said, because of the “very real and distinguishing” differences between them. While Liechtenstein is only now amending its laws on tax evasion, other offshore financial centers like Jersey and Guernsey already did so a decade ago; Switzerland, the Cayman Islands and Singapore have not.
Meanwhile there is the other elephant in the room: banking secrecy. Liechtenstein seems keen to keep its rules in that area unchanged. "Our bank secrecy has always served to ensure the legitimate protection of the privacy of the citizen, which we will continue to retain,” Hasler said Thursday.
Platt believes that the G-20 nations are looking at tax evasion and banking secrecy as two related but distinctly important issues. “The criminalization of laundering of tax evasion is equally as important, [but] tax havens that do not address bank secrecy need to see it addressed,” he said.
Source: Forbes
Timing is everything these days, especially for a tax haven like Liechtenstein. A day before finance ministers of the Group of 20 were due to meet to discuss new guidelines to stop tax evasion, one of the world’s favored destinations for such shenanigans said it would start helping other nations claw back their missing tax revenues.
The tiny Alpine principality said Thursday that it was dropping its distinction between tax evasion and tax fraud, an issue that has frustrated tax authorities in the United States and Germany because Liechtenstein previously insisted on only handing over data in cases of outright tax fraud.
It now says it has already begun “concrete talks” with other nations and was offering bilateral tax agreements in cases of tax fraud and tax evasion. "We are aware of our responsibility as part of a globally integrated economic area,” Prime Minister Otmar Hasler said. “With today's declaration, we are making our contribution to a joint solution that will make an effective enforcement of foreign tax claims possible.”
International organizations such as the Organization for Economic Cooperation and Development have been lobbying for more transparency from tax havens like Liechtenstein, Switzerland and Luxembourg for many years now. But the crackdown has now reached a critical stage as governments around the world seek to tighten financial regulations to prevent another repeat of the credit crunch while desperately trying find new tax revenues.
France and Germany have already asked the OECD to prepare information on tax havens for the G-20 meeting in London on April 2. On Tuesday, France’s La Tribune reported that the OECD was adding Switzerland, Luxembourg, Austria, Singapore and Hong Kong to its list of noncooperative tax centers, which already included Liechtenstein.
Stephen Platt, chairman of the BakerPlatt Group and specialist in anti-money-laundering, said that Liechtenstein’s move was “essential” to its ongoing survival. "It is simply untenable within this climate and this environment for centers to continue not to criminalize the laundering of the proceeds of foreign tax evasion," he said, adding that in the long term such rules were “unsustainable and not good for your reputation.”
But the international backlash against tax havens by governments and the G-20 may also be too indiscriminate, he said, because of the “very real and distinguishing” differences between them. While Liechtenstein is only now amending its laws on tax evasion, other offshore financial centers like Jersey and Guernsey already did so a decade ago; Switzerland, the Cayman Islands and Singapore have not.
Meanwhile there is the other elephant in the room: banking secrecy. Liechtenstein seems keen to keep its rules in that area unchanged. "Our bank secrecy has always served to ensure the legitimate protection of the privacy of the citizen, which we will continue to retain,” Hasler said Thursday.
Platt believes that the G-20 nations are looking at tax evasion and banking secrecy as two related but distinctly important issues. “The criminalization of laundering of tax evasion is equally as important, [but] tax havens that do not address bank secrecy need to see it addressed,” he said.
Source: Forbes
Labels:
Austria,
Cayman,
Germany,
Guernsey,
Hong Kong,
Jersey,
Liechtenstein,
Luxembourg,
Singapore,
Swaziland,
US
0
comments
on Saturday, March 31, 2012
With the World Cup fast approaching, Hong Kong police are planning to crack down on illegal gambling on football matches.
They are focusing their efforts on gambling websites, and plan to conduct cyber patrols.
Figures show gambling problems tend to jump during World Cup years.
During the last competition in 2006, Hong Kong police arrested 342 people in relation to illegal bookmaking and seized over US$20 million worth of illegal bets.
Although gambling is a popular activity in Hong Kong, it is strictly controlled. Betting is only allowed through the official Hong Kong Jockey Club or the weekly government-run lottery.
The government has pumped an additional $2 million to promote anti-gambling messages, and the police have formed a special task force to crack down on the problem.
Experts are focusing on cyber-gambling, which has become more prevalent over recent years.
Police will conduct cyber patrols to identify illegal online bookies.
"We have contacted the service providers of the website companies, in order to get some insight or intelligence regarding illegal gambling information," said Superintendent Man Tat-shing of the Hong Kong Organised Crime and Triad Bureau.
Police are also co-coordinating with banks to report any suspicious transactions.
"Some illegal websites overseas may accept credit card payment or bank remittancy. All of these information, we'll look into once the relevant financial institutions report it to us," said Superintendent Man.
Those caught engaging in illegal soccer gambling in Hong Kong can face up to 9 months in jail.
Source: Channel News Asia
on Friday, March 9, 2012
The Hong Kong Special Administrative Region (HKSAR) government on Thursday launched a three-month public consultation on a proposed framework legislation on anti-money laundering in respect of the financial sectors.
The Financial Services and the Treasury Bureau (FSTB) said the initiative was a direct response to a call from the Financial Action Task Force (FATF) for Hong Kong to provide statutory backing and appropriate sanctions for customer due diligence and record-keeping requirements for financial institutions, and to put in place an anti-money laundering framework for remittance agents and money changers.
The FATF was an inter-government body created in 1989 with the mission of pushing for and setting the international standards on anti-money laundering regime.
"The proposal is intended to address the deficiencies identified by the FATF in Hong Kong's anti-money laundering regime in its evaluation completed in 2008 and will help maintain Hong Kong's status as an international financial center," said the FSTB.
The proposed Hong Kong framework prescribes the customer due diligence and record keeping requirements for financial institutions, including banks and deposit-taking institutions, among others. It also provided for appropriate regulatory powers.
It provided for criminal and supervisory sanctions, with the establishment of an independent statutory appeals tribunal.
A licensing system will also be introduced for remittance agents and money changers for anti-money laundering regulation and administered by customs authorities.
The FSTB said it was aiming at another round of consultation on the detailed proposals towards the end of the year, adding that it was expecting the introduction of the bill into the Legislative Council in the second quarter of 2010.
Source: Xinhua
The Financial Services and the Treasury Bureau (FSTB) said the initiative was a direct response to a call from the Financial Action Task Force (FATF) for Hong Kong to provide statutory backing and appropriate sanctions for customer due diligence and record-keeping requirements for financial institutions, and to put in place an anti-money laundering framework for remittance agents and money changers.
The FATF was an inter-government body created in 1989 with the mission of pushing for and setting the international standards on anti-money laundering regime.
"The proposal is intended to address the deficiencies identified by the FATF in Hong Kong's anti-money laundering regime in its evaluation completed in 2008 and will help maintain Hong Kong's status as an international financial center," said the FSTB.
The proposed Hong Kong framework prescribes the customer due diligence and record keeping requirements for financial institutions, including banks and deposit-taking institutions, among others. It also provided for appropriate regulatory powers.
It provided for criminal and supervisory sanctions, with the establishment of an independent statutory appeals tribunal.
A licensing system will also be introduced for remittance agents and money changers for anti-money laundering regulation and administered by customs authorities.
The FSTB said it was aiming at another round of consultation on the detailed proposals towards the end of the year, adding that it was expecting the introduction of the bill into the Legislative Council in the second quarter of 2010.
Source: Xinhua
A top U.S. Treasury official met with Hong Kong regulators and bankers Thursday as part of an effort to keep North Korea from using the international financial system to fund its nuclear program and other illicit activities.
Stuart Levey, a U.S. Treasury undersecretary who oversees the department's terrorism and financial intelligence section, met with officials from Hong Kong's de facto central bank, the Hong Kong Monetary Authority, the bank said in a brief statement to The Associated Press.
The authority refused to release details of the talks.
Levey was also meeting with executives from HSBC, the giant London-based lender with major operations in Hong Kong and elsewhere in Asia, according to a person familiar with the matter. The person spoke on condition of anonymity because of the sensitivity of the situation.
The meeting was "to remind people that there are regulations," the person said.
Levey traveled to China and Hong Kong this week to gain support for U.S. initiatives to curb North Korea's access to banks and businesses to buy and sell missile and nuclear technology. He arrived Monday in China and was meeting with government officials and private sector executives Wednesday through Friday.
However, at least one Hong Kong-based bank, the Bank of East Asia, declined to meet with Stuart.
"He requested a meeting with us, but unfortunately we were not able to meet with him," said the bank's chief executive, David Li. "We have nothing to do with North Korea."
A Treasury spokesperson did not immediately return a message seeking comment.
The international community has been struggling to rein in North Korea since the reclusive totalitarian state conducted a nuclear test in May.
The U.N. Security Council last month adopted tougher new sanctions, which North Korea defied last week with missile launches.
U.S. officials have gone after North Korea's funding before.
In 2005, the U.S. imposed financial restrictions on Banco Delta Asia, a bank near Hong Kong in the Chinese territory of Macau, over allegations it helped North Korea with money laundering and other illicit activities.
The move effectively cut Pyongyang off from the global financial system, analysts say, because banks in other countries, including North Korean ally China, did not want to jeopardize access to the U.S. financial system.
The restrictions were lifted in 2007 to nudge North Korea back to stalled nuclear talks.
Source: Los Angeles Times
Stuart Levey, a U.S. Treasury undersecretary who oversees the department's terrorism and financial intelligence section, met with officials from Hong Kong's de facto central bank, the Hong Kong Monetary Authority, the bank said in a brief statement to The Associated Press.
The authority refused to release details of the talks.
Levey was also meeting with executives from HSBC, the giant London-based lender with major operations in Hong Kong and elsewhere in Asia, according to a person familiar with the matter. The person spoke on condition of anonymity because of the sensitivity of the situation.
The meeting was "to remind people that there are regulations," the person said.
Levey traveled to China and Hong Kong this week to gain support for U.S. initiatives to curb North Korea's access to banks and businesses to buy and sell missile and nuclear technology. He arrived Monday in China and was meeting with government officials and private sector executives Wednesday through Friday.
However, at least one Hong Kong-based bank, the Bank of East Asia, declined to meet with Stuart.
"He requested a meeting with us, but unfortunately we were not able to meet with him," said the bank's chief executive, David Li. "We have nothing to do with North Korea."
A Treasury spokesperson did not immediately return a message seeking comment.
The international community has been struggling to rein in North Korea since the reclusive totalitarian state conducted a nuclear test in May.
The U.N. Security Council last month adopted tougher new sanctions, which North Korea defied last week with missile launches.
U.S. officials have gone after North Korea's funding before.
In 2005, the U.S. imposed financial restrictions on Banco Delta Asia, a bank near Hong Kong in the Chinese territory of Macau, over allegations it helped North Korea with money laundering and other illicit activities.
The move effectively cut Pyongyang off from the global financial system, analysts say, because banks in other countries, including North Korean ally China, did not want to jeopardize access to the U.S. financial system.
The restrictions were lifted in 2007 to nudge North Korea back to stalled nuclear talks.
Source: Los Angeles Times
on Tuesday, January 30, 2007
By Paul Wiseman, USA TODAY
HONG KONG — By the standards of international finance, the amount is trifling: $24 million — less than a lot of CEOs take home in a year.
But that sum — North Korean money stuck in the sleepy Chinese territory of Macau — could hold the key to ending a 4½-year nuclear standoff with North Korea.
The money was frozen 16 months ago when U.S. Treasury Undersecretary Stuart Levey accused a small bank in Macau, Banco Delta Asia, of being "a willing pawn" in North Korea's "corrupt financial activities."
North Korea wants its money back, and the money has become a bargaining chip as the United States leads the diplomatic effort to get North Korea's isolated Stalinist regime to give up its nuclear weapons program.
International talks aimed at dismantling North Korea's nuclear program are to resume Feb. 8 after breaking off in December.
Tuesday, a U.S. delegation led by Deputy Assistant Treasury Secretary Daniel Glaser met at the U.S. Embassy in Beijing with North Korean officials to discuss the $24 million and related allegations: that the communist state is a financial rogue engaged in counterfeiting and money laundering.
If the money talks go well, North Korea might be willing to make concessions on its nuclear program, says Park Young Ho, senior research fellow at the Korea Institute for National Unification in Seoul.
Treasury officials won't comment on widespread speculation in Japanese and South Korean media that the United States is ready to OK the release of perhaps $13 million of the $24 million to give a boost to next week's nuclear talks, which will involve South Korea, China, Japan and Russia, in addition to the United States and North Korea.
The Bush administration alleges that North Korea raises hard currency through criminal activities — peddling pirated cigarettes and Viagra, trafficking in heroin and methamphetamine and printing counterfeit U.S. dollars. At least $45 million in North Korean "supernotes" — near-perfect duplicates of U.S. $100 bills — have been found in circulation, the Congressional Research Service (CRS) reported last year. North Korea earns $15 million to $25 million a year from counterfeiting, CRS has estimated.
Some of those bogus North Korean bills have made their way to Macau, 40 miles west of Hong Kong. Banco Delta Asia, which has $320 million in assets and eight branches (including one in a casino) was North Korea's banker in Macau.
In 1994, a teller at the bank caught two executives from Zokwang Trading, a North Korean front company, trying to deposit $250,000 in counterfeit bills; the men carried diplomatic passports.
Despite the incident, Banco Delta Asia continued to do business with Zokwang for more than a decade — a sign of the bank's tolerance for illicit North Korean business, the U.S. Treasury says. The Treasury chided the government of Macau, a former Portuguese colony that is a specially administered region of China, for lax money-laundering regulations.
The Treasury hasn't imposed any sanctions on Banco Delta Asia. The regulatory case against the bank has been pending since September 2005.
Still, when the bank appeared on the Treasury's blacklist, other banks stopped doing business with it. Customers withdrew $133 million — more than a third of the bank's deposits — within a week. Macau's government froze the $24 million in North Korean accounts, replaced the bank's senior management and suspended chairman Stanley Au, a well-known entrepreneur and former Macau legislator who continues to own the bank. The new management team ended the bank's business relations with North Korea.
The bank also hired U.S. lawyers and lobbyists, who have tried unsuccessfully to get the Treasury to drop its case. The United States hasn't offered detailed evidence against Banco Delta Asia, noting that it has relied on classified sources. Glaser says Treasury officials have studied 300,000 pages of bank documents. "We are quite confident of what we said in September 2005," he says. "Now that we've had a chance to look behind the veil a bit, we know we made the right decision."
In Macau, the bank is widely seen as a pawn in the U.S. diplomatic campaign against North Korea. "There's a general perception that the Americans are using this as a weapon, a way to pressure Pyongyang," says Paulo Azevedo, executive director of Macau Business magazine. "Everybody knew for 10 years about the strong connections between North Korea and Macau. (North Korean airline) Air Koryo was flying through Macau. The flights were full of luxury goods going to Pyongyang. Everybody knew — and the Americans didn't? What a coincidence" that the issue emerged in the middle of the nuclear standoff.
Levey, Treasury undersecretary for terrorism and financial intelligence, says, "This is not about punishing North Korea. This is about protecting the international financial system."
Whatever the U.S. motivation, the North Koreans reacted with fury, pulling out of the six-party nuclear talks in November 2005. Park at the Korean unification institute says the North Koreans see the allegations of money laundering and counterfeiting as a slap at their leader and a suggestion that dictator Kim Jong Il is an international gangster. "Face-saving is very important to North Korea," he says.
Macau, which has overtaken Las Vegas as the world's No. 1 gambling market, has passed a stronger anti-money-laundering act.
"We're really pleased with the progress Macau's made," Glaser says. "It's important they play by the rules."
Azevedo of Macau Business agrees that Macau needed to crack down on money laundering. "If the Americans are the only ones with the muscle to stop it, then OK," he says. "Better late than never."
Contributing: Barbara Slavin in Washington; wire reports
http://www.usatoday.com/news/world/2007-01-30-macau-bank_x.htm
HONG KONG — By the standards of international finance, the amount is trifling: $24 million — less than a lot of CEOs take home in a year.
But that sum — North Korean money stuck in the sleepy Chinese territory of Macau — could hold the key to ending a 4½-year nuclear standoff with North Korea.
The money was frozen 16 months ago when U.S. Treasury Undersecretary Stuart Levey accused a small bank in Macau, Banco Delta Asia, of being "a willing pawn" in North Korea's "corrupt financial activities."
North Korea wants its money back, and the money has become a bargaining chip as the United States leads the diplomatic effort to get North Korea's isolated Stalinist regime to give up its nuclear weapons program.
International talks aimed at dismantling North Korea's nuclear program are to resume Feb. 8 after breaking off in December.
Tuesday, a U.S. delegation led by Deputy Assistant Treasury Secretary Daniel Glaser met at the U.S. Embassy in Beijing with North Korean officials to discuss the $24 million and related allegations: that the communist state is a financial rogue engaged in counterfeiting and money laundering.
If the money talks go well, North Korea might be willing to make concessions on its nuclear program, says Park Young Ho, senior research fellow at the Korea Institute for National Unification in Seoul.
Treasury officials won't comment on widespread speculation in Japanese and South Korean media that the United States is ready to OK the release of perhaps $13 million of the $24 million to give a boost to next week's nuclear talks, which will involve South Korea, China, Japan and Russia, in addition to the United States and North Korea.
The Bush administration alleges that North Korea raises hard currency through criminal activities — peddling pirated cigarettes and Viagra, trafficking in heroin and methamphetamine and printing counterfeit U.S. dollars. At least $45 million in North Korean "supernotes" — near-perfect duplicates of U.S. $100 bills — have been found in circulation, the Congressional Research Service (CRS) reported last year. North Korea earns $15 million to $25 million a year from counterfeiting, CRS has estimated.
Some of those bogus North Korean bills have made their way to Macau, 40 miles west of Hong Kong. Banco Delta Asia, which has $320 million in assets and eight branches (including one in a casino) was North Korea's banker in Macau.
In 1994, a teller at the bank caught two executives from Zokwang Trading, a North Korean front company, trying to deposit $250,000 in counterfeit bills; the men carried diplomatic passports.
Despite the incident, Banco Delta Asia continued to do business with Zokwang for more than a decade — a sign of the bank's tolerance for illicit North Korean business, the U.S. Treasury says. The Treasury chided the government of Macau, a former Portuguese colony that is a specially administered region of China, for lax money-laundering regulations.
The Treasury hasn't imposed any sanctions on Banco Delta Asia. The regulatory case against the bank has been pending since September 2005.
Still, when the bank appeared on the Treasury's blacklist, other banks stopped doing business with it. Customers withdrew $133 million — more than a third of the bank's deposits — within a week. Macau's government froze the $24 million in North Korean accounts, replaced the bank's senior management and suspended chairman Stanley Au, a well-known entrepreneur and former Macau legislator who continues to own the bank. The new management team ended the bank's business relations with North Korea.
The bank also hired U.S. lawyers and lobbyists, who have tried unsuccessfully to get the Treasury to drop its case. The United States hasn't offered detailed evidence against Banco Delta Asia, noting that it has relied on classified sources. Glaser says Treasury officials have studied 300,000 pages of bank documents. "We are quite confident of what we said in September 2005," he says. "Now that we've had a chance to look behind the veil a bit, we know we made the right decision."
In Macau, the bank is widely seen as a pawn in the U.S. diplomatic campaign against North Korea. "There's a general perception that the Americans are using this as a weapon, a way to pressure Pyongyang," says Paulo Azevedo, executive director of Macau Business magazine. "Everybody knew for 10 years about the strong connections between North Korea and Macau. (North Korean airline) Air Koryo was flying through Macau. The flights were full of luxury goods going to Pyongyang. Everybody knew — and the Americans didn't? What a coincidence" that the issue emerged in the middle of the nuclear standoff.
Levey, Treasury undersecretary for terrorism and financial intelligence, says, "This is not about punishing North Korea. This is about protecting the international financial system."
Whatever the U.S. motivation, the North Koreans reacted with fury, pulling out of the six-party nuclear talks in November 2005. Park at the Korean unification institute says the North Koreans see the allegations of money laundering and counterfeiting as a slap at their leader and a suggestion that dictator Kim Jong Il is an international gangster. "Face-saving is very important to North Korea," he says.
Macau, which has overtaken Las Vegas as the world's No. 1 gambling market, has passed a stronger anti-money-laundering act.
"We're really pleased with the progress Macau's made," Glaser says. "It's important they play by the rules."
Azevedo of Macau Business agrees that Macau needed to crack down on money laundering. "If the Americans are the only ones with the muscle to stop it, then OK," he says. "Better late than never."
Contributing: Barbara Slavin in Washington; wire reports
http://www.usatoday.com/news/world/2007-01-30-macau-bank_x.htm
on Monday, January 29, 2007
The Hong Kong Security Bureau has said that from January 26, remittance agents and money changers must verify customers' identities, and record transactions of HK$8,000 (US$1,024) or more.
They must also verify the identity of anyone who receives a remittance of HK$8,000 or more.
The requirements aim to meet the new international standards with regard to combating money laundering and terrorist financing.
Customers must produce their Hong Kong identity cards - or certificate of identity, document of identity or travel document - for verification, and provide their addresses and telephone numbers.
Agents and money changers must also record and retain the particulars of the sender and the instructor of any transaction if the two are not the same person.
Commissioner for Narcotics, Sally Wong urged the agents in question to include the sender's information in the transactions, in order to facilitate remittance to countries which demand such information.
She said that those who came across suspicious transactions should report them to the joint financial intelligence unit, a team set up jointly by the Police and Customs departments.
http://www.tax-news.com/asp/story/story_open.asp?storyname=26179
They must also verify the identity of anyone who receives a remittance of HK$8,000 or more.
The requirements aim to meet the new international standards with regard to combating money laundering and terrorist financing.
Customers must produce their Hong Kong identity cards - or certificate of identity, document of identity or travel document - for verification, and provide their addresses and telephone numbers.
Agents and money changers must also record and retain the particulars of the sender and the instructor of any transaction if the two are not the same person.
Commissioner for Narcotics, Sally Wong urged the agents in question to include the sender's information in the transactions, in order to facilitate remittance to countries which demand such information.
She said that those who came across suspicious transactions should report them to the joint financial intelligence unit, a team set up jointly by the Police and Customs departments.
http://www.tax-news.com/asp/story/story_open.asp?storyname=26179
on Thursday, January 25, 2007
The Security Bureau says from January 26, remittance agents and money changers must verify customers' identities and record transactions of $8,000 or more.
They must also verify the identity of anyone who receives a remittance of $8,000 or more.
The requirements aim to meet the new international standard related to combating money laundering and terrorism financing.
Customers must produce their Hong Kong identity cards - or certificate of identity, document of identity or travel document - for verification, and provide their addresses and telephone numbers.
Agents and money changers must also record and retain the particulars of the sender and the instructor of any transaction if the two are not the same person.
Commissioner for Narcotics Sally Wong urged them to include the sender's information in the transactions, to facilitate remittance to countries which demand such information
She said those who came across suspicious transactions should report to the joint financial intelligence unit, a team set up jointly by Police and Customs.
http://www.news.gov.hk/en/category/lawandorder/070125/html/070125en03005.htm
They must also verify the identity of anyone who receives a remittance of $8,000 or more.
The requirements aim to meet the new international standard related to combating money laundering and terrorism financing.
Customers must produce their Hong Kong identity cards - or certificate of identity, document of identity or travel document - for verification, and provide their addresses and telephone numbers.
Agents and money changers must also record and retain the particulars of the sender and the instructor of any transaction if the two are not the same person.
Commissioner for Narcotics Sally Wong urged them to include the sender's information in the transactions, to facilitate remittance to countries which demand such information
She said those who came across suspicious transactions should report to the joint financial intelligence unit, a team set up jointly by Police and Customs.
http://www.news.gov.hk/en/category/lawandorder/070125/html/070125en03005.htm
on Thursday, January 18, 2007
HONG KONG: Two managers of companies at the center of a decade- long, $482 million fraud at Bank of China were convicted Thursday of criminal conspiracy by a Hong Kong district court.
Hui Yat-sing, a former deputy general manager and director of Ever Joint Properties, and his wife, Wong Suet- mui, a former manager of Yau Hip Trading, face up to seven years in prison for handling tens of millions of dollars embezzled from Bank of China.
The mainland Chinese banking industry has been plagued by inadequate risk management and corruption, undermining confidence in the lenders. In November, Zhang Enzhao, a former chairman of China Construction Bank was sentenced to 15 years in prison for accepting 4.19 million yuan, or $539,000, in bribes. His predecessor, Wang Xuebing, was jailed for 12 years in 2003 for taking bribes.
The Hong Kong trial, which began in October, was the first proceeding in China held outside of the mainland related to the misappropriation of $482 million from a Bank of China branch in the city of Kaiping, about 110 kilometers, or 70 miles, from Hong Kong.
Hong Kong is a special administrative region of China, and has a separate legal system from that used in mainland China.
Hui and Wong, both 48, were charged with conspiring with three Bank of China managers and others by handling money stolen from the bank between 1992 and 2001.
A Hong Kong prosecutor, Charlotte Draycott, said the funds were transferred to Ever Joint through complicit mainland companies that received loans from Bank of China, black market underground banks and unauthorized direct lending.
In convicting the couple, Judge Stephen Geiser rejected the defendants' defense that they thought they were handling legitimate money for a "window company" set up by Bank of China's Kaiping branch to conduct business overseas.
Bank of China, the second-largest Chinese bank, has accused the three branch managers in Kaiping of using Chinese companies to illegally siphon tens of millions of dollars to Ever Joint, which was registered in Hong Kong.
Two of the managers, Xu Chaofan, 41, and Xu Guojun, 48, fled to the United States in 2001. The managers, who are not related, are in jail in Las Vegas awaiting trial, scheduled to start this year. They face a 15-count U.S. federal indictment accusing them of racketeering, money laundering and visa fraud related to the theft.
Yu Zhendong, the third Kaiping manager, was arrested in Los Angeles in December 2002 and pleaded guilty to racketeering before being returned to China for a trial in April 2004. In a mainland court, Yu admitted to embezzling $82.47 million and stealing $167 million through bogus loans, according to press reports. He was sentenced to 12 years in March, Xinhua press agency reported.
Chinese banks uncovered 776 cases of fraud between January and October last year, with a quarter of the cases involving at least 1 million yuan, according to the China Banking Regulatory Commission. In one case, a manager at a Bank of China branch in central China stole 2.6 million yuan from a vault in November, The Shanghai Morning Post reported Dec. 5, citing local police.
http://www.iht.com/articles/2007/01/18/bloomberg/sxfraud.php
Hui Yat-sing, a former deputy general manager and director of Ever Joint Properties, and his wife, Wong Suet- mui, a former manager of Yau Hip Trading, face up to seven years in prison for handling tens of millions of dollars embezzled from Bank of China.
The mainland Chinese banking industry has been plagued by inadequate risk management and corruption, undermining confidence in the lenders. In November, Zhang Enzhao, a former chairman of China Construction Bank was sentenced to 15 years in prison for accepting 4.19 million yuan, or $539,000, in bribes. His predecessor, Wang Xuebing, was jailed for 12 years in 2003 for taking bribes.
The Hong Kong trial, which began in October, was the first proceeding in China held outside of the mainland related to the misappropriation of $482 million from a Bank of China branch in the city of Kaiping, about 110 kilometers, or 70 miles, from Hong Kong.
Hong Kong is a special administrative region of China, and has a separate legal system from that used in mainland China.
Hui and Wong, both 48, were charged with conspiring with three Bank of China managers and others by handling money stolen from the bank between 1992 and 2001.
A Hong Kong prosecutor, Charlotte Draycott, said the funds were transferred to Ever Joint through complicit mainland companies that received loans from Bank of China, black market underground banks and unauthorized direct lending.
In convicting the couple, Judge Stephen Geiser rejected the defendants' defense that they thought they were handling legitimate money for a "window company" set up by Bank of China's Kaiping branch to conduct business overseas.
Bank of China, the second-largest Chinese bank, has accused the three branch managers in Kaiping of using Chinese companies to illegally siphon tens of millions of dollars to Ever Joint, which was registered in Hong Kong.
Two of the managers, Xu Chaofan, 41, and Xu Guojun, 48, fled to the United States in 2001. The managers, who are not related, are in jail in Las Vegas awaiting trial, scheduled to start this year. They face a 15-count U.S. federal indictment accusing them of racketeering, money laundering and visa fraud related to the theft.
Yu Zhendong, the third Kaiping manager, was arrested in Los Angeles in December 2002 and pleaded guilty to racketeering before being returned to China for a trial in April 2004. In a mainland court, Yu admitted to embezzling $82.47 million and stealing $167 million through bogus loans, according to press reports. He was sentenced to 12 years in March, Xinhua press agency reported.
Chinese banks uncovered 776 cases of fraud between January and October last year, with a quarter of the cases involving at least 1 million yuan, according to the China Banking Regulatory Commission. In one case, a manager at a Bank of China branch in central China stole 2.6 million yuan from a vault in November, The Shanghai Morning Post reported Dec. 5, citing local police.
http://www.iht.com/articles/2007/01/18/bloomberg/sxfraud.php
on Friday, December 22, 2006
For a single-fronted store with a sink that doubled as a toilet, Long Thanh Money Transfer Company's last financial year was extraordinary.
From its setting among fruit shops, seafood stalls and hairdressers in Footscray's "little Saigon" shopping district, the money remitter moved — according to police estimates — more than $200 million out of Australia.
Much of it was delivered as bundles of cash stuffed in Safeway bags. And much of it, according to allegations made later in court by the Australian Crime Commission, was drug money.
The October arrests of the Long Thanh operators marked the climax of one of the most significant operations ever undertaken by the commission.
Despite minimal publicity, the investigation has achieved multiple successes. Scores of drug dealers belonging to five, mostly Vietnamese, syndicates have been arrested. The channels they allegedly used to siphon the drug money to South-East Asia syndicates have been dismantled, a rare coup for police given the difficulty of following money trails.
Investigators have learned how the arrested money-movers infiltrated some of Australia's major banks and an international airline. And in the face of fierce global criticism about the way Australia is fighting money laundering — estimated to involve $2 billion to $3 billion billion annually — and terrorist financing, investigators have laid the groundwork for an increasingly sophisticated law enforcement battle.
Two vastly different events set Australia's biggest-ever drug-money investigation in motion. The first was an ACC operation codenamed Katakan. It focused on drug trafficking down the east coast by Brisbane-based Asian syndicates and also gathered intelligence on the movement of the syndicate's earnings.
The second event took place in a confidential meeting in early 2005 between senior police.
Australia had been under pressure from international agencies, including the Paris-based Financial Action Task Force, over holes in the nation's financial system that left it vulnerable to money laundering and terrorist financing.
The Federal Government was mid-way through drafting new laws toughening anti-laundering regulation and policing.
Against that backdrop, those at the meeting, including ACC chief Alastair Milroy and Australian Federal Police Commissioner Mick Keelty, signed off on a new operational approach focusing on the movement of dirty money, not just the crime that produced it.
Using the intelligence from Operation Katakan, Taskforce Gordian was born. Its motto was simple: follow the money trail.
With continuing demand among drug users for methamphetamine ("ice") and heroin, the nation's drug syndicates enjoy a steady stream of profits. But the dealers face a problem: how to transfer large amounts of dirty money — to invest in assets or send overseas to drug exporters — without attracting scrutiny from authorities.
Businesses are required to report transactions of $10,000 or more, overseas wire transfers, and suspicious money movements to the financial watchdog, AUSTRAC.
But the intelligence from Katakan pointed to a system used by Asian drug syndicates to send money overseas — where it can be more easily hidden or cleaned — without setting off AUSTRAC's alarm bells.
The system allegedly involved a small network of money remitters in Melbourne and Sydney, controlled by Long Thanh Money Transfer's manager, Hang Thanh Huynh, 36, her husband, Tuong Manh Hoang, 45, and Huynh's mother in Ho Chi Minh City. (All have denied any wrongdoing.)
Long Thanh is just one of hundreds of money remitters tucked away in ethnic enclaves. The remitters offer a less formal and cheaper money-moving service for expatriate workers, combining their pay before sending the money overseas to avoid multiple transfer fees.
Such was the service Long Thanh ostensibly offered in the district nicknamed "little Saigon". Here, soup shops, men playing draughts and blaring Vietnamese pop songs provide a sense of home for the Asian community.
Yet it is alleged that many of Long Thanh's customers were not interested in saving on fees. Rather, they had money to burn. In court in late October, ACC investigators alleged the shop was frequented by figures from major Asian crime syndicates based in Victoria and NSW. One client, known as "Choc", allegedly visited Long Thanh's store in Bankstown, Sydney, twice a week to check that the money deposited matched that sent overseas. He is alleged to have ordered 90 transactions totalling $20 million.
The monitoring of facsimiles sent between the Victorian and NSW remitters was a key part of the ACC's investigation, especially as the suspects regularly switched mobile phones or talked in code to counter phone-taps. According to an ACC fact sheet tendered to court: "Intercepted facsimiles reveal that since December 2005, approximately $93 million has been transferred (by Long Thanh) to their businesses in Vietnam.
"The money is then transferred on to various groups in Cambodia, Hong Kong and other South-East Asian countries on behalf of clients of the money remittance business. It is believed that the majority of this total is the proceeds of drug importation and distribution operations."
Long Thanh allegedly used a range of methods to sidestep AUSTRAC's attention. The store's operators failed to lodge transaction records; they hid the identities of their clients and the overseas recipients; and they used other remitters to dilute the volume of money and the frequency with which it was sent offshore.
But, perhaps most ominously, Long Thanh also had its tentacles inside some major banks, as well as Vietnam Airlines. It is understood the ACC has concerns about some of the suburban bank employees who managed the remitter's accounts. An employee of the ANZ bank in the western suburbs is under scrutiny for her failure to report the extraordinary deposits and transfers made through Long Thanh's accounts. Questions are also being asked about employees from another major bank.
Authorities are also concerned about Long Thanh's relationship with members of flight crews working for Vietnam Airlines.
In court, it was revealed that an ACC surveillance crew targeted a Vietnam Airlines pilot, Van Dang Tran, after he flew into Sydney in early June. Within 24 hours, he was taking a phone call from a Long Thanh manager about "how many green tops" he could carry on his flight home. Tran responded that he could handle as much as possible.
A day later, during a routine search of the checked-in baggage belonging to the Vietnam Airlines air crew, Tran's suitcase was searched. Customs officers allegedly found 14 packages containing $549,265.
The find may have been the tip of the iceberg. The ACC later alleged in court that more than $10 million has flown out of the country as Long Thanh "used employees from Vietnam Airlines to remove large amounts of (drug) money from Australia".
Along with Tran and some of Long Thanh's employees, Taskforce Gordian has arrested more than 50 people in Australia over the past six months. Long Thanh's manager, Hang Thanh Huynh, is charged with conspiracy to launder up to $93 million of drug money overseas. A number of the company's clients have been charged with drug offences.
More arrests are planned, but the focus is shifting to the court cases, which are likely to be long and complex. Money laundering prosecutions in Australia have a poor success rate, partly because of the difficulty of proving that funds were "tainted" and those moving them knew it.
A November report by the International Monetary Fund states that "while the (Australian) legal measures are comprehensive, they are not fully effective, as investigators generally do not investigate and refer money laundering as a separate charge, and (the) number of prosecutions for money laundering is generally low".
Money launderings experts, such as former National Crime Authority chairman John Broome, blame a tendency for police and prosecutors to focus on "primary" crimes, rather than the movement of profits they generate. Taskforce Gordian, he says, may signal a welcome shift. But Mr Broome believes the anti-money laundering and terrorist financing reforms passed earlier this month still leave Australia vulnerable.
After September 11, scores of countries, including Australia, signed the Financial Action Task Force's new regime for fighting the black money trade.
Australia's new laws include boosts to AUSTRAC's resources and powers, and new rules for money remitters, banks, bullion dealers, accountants and casinos to report suspicious transactions and scrutinise customers.
After intense lobbying from business groups, especially the banks, the Government will phase the changes in over two years.
"A lot of banks have not been strongly compliant with existing rules, especially banks with branches in Asia and the Pacific," says Mr Broome.
"We have made some steps forward. But have we really got stuck into this stuff? The answer has to be no. For instance, I see no discernible crackdown on charities. And the phased approach means we won't see needed changes in place by 2009."
There are private rumblings among some senior police as to whether the new reforms go far enough given the negligible amount of terrorist funds seized in Australia.
Even with Gordian's concerted effort to track drug funds, the ease with which money moves overseas presents problems. Developing countries often do not have the expertise, laws or will to locate and seize dirty money.
According to public announcements, Gordian had seized less than 5 per cent of the drug dollars allegedly sent to South-East Asia.
It is, however, a work in progress. ACC officers have made numerous trips to Vietnam and are working closely with the country's authorities.
The money trail is not cold yet.
http://www.theage.com.au/news/national/exposed-multimilliondollar-drug-network/2006/12/22/1166290743054.html?page=fullpage#contentSwap1
From its setting among fruit shops, seafood stalls and hairdressers in Footscray's "little Saigon" shopping district, the money remitter moved — according to police estimates — more than $200 million out of Australia.
Much of it was delivered as bundles of cash stuffed in Safeway bags. And much of it, according to allegations made later in court by the Australian Crime Commission, was drug money.
The October arrests of the Long Thanh operators marked the climax of one of the most significant operations ever undertaken by the commission.
Despite minimal publicity, the investigation has achieved multiple successes. Scores of drug dealers belonging to five, mostly Vietnamese, syndicates have been arrested. The channels they allegedly used to siphon the drug money to South-East Asia syndicates have been dismantled, a rare coup for police given the difficulty of following money trails.
Investigators have learned how the arrested money-movers infiltrated some of Australia's major banks and an international airline. And in the face of fierce global criticism about the way Australia is fighting money laundering — estimated to involve $2 billion to $3 billion billion annually — and terrorist financing, investigators have laid the groundwork for an increasingly sophisticated law enforcement battle.
Two vastly different events set Australia's biggest-ever drug-money investigation in motion. The first was an ACC operation codenamed Katakan. It focused on drug trafficking down the east coast by Brisbane-based Asian syndicates and also gathered intelligence on the movement of the syndicate's earnings.
The second event took place in a confidential meeting in early 2005 between senior police.
Australia had been under pressure from international agencies, including the Paris-based Financial Action Task Force, over holes in the nation's financial system that left it vulnerable to money laundering and terrorist financing.
The Federal Government was mid-way through drafting new laws toughening anti-laundering regulation and policing.
Against that backdrop, those at the meeting, including ACC chief Alastair Milroy and Australian Federal Police Commissioner Mick Keelty, signed off on a new operational approach focusing on the movement of dirty money, not just the crime that produced it.
Using the intelligence from Operation Katakan, Taskforce Gordian was born. Its motto was simple: follow the money trail.
With continuing demand among drug users for methamphetamine ("ice") and heroin, the nation's drug syndicates enjoy a steady stream of profits. But the dealers face a problem: how to transfer large amounts of dirty money — to invest in assets or send overseas to drug exporters — without attracting scrutiny from authorities.
Businesses are required to report transactions of $10,000 or more, overseas wire transfers, and suspicious money movements to the financial watchdog, AUSTRAC.
But the intelligence from Katakan pointed to a system used by Asian drug syndicates to send money overseas — where it can be more easily hidden or cleaned — without setting off AUSTRAC's alarm bells.
The system allegedly involved a small network of money remitters in Melbourne and Sydney, controlled by Long Thanh Money Transfer's manager, Hang Thanh Huynh, 36, her husband, Tuong Manh Hoang, 45, and Huynh's mother in Ho Chi Minh City. (All have denied any wrongdoing.)
Long Thanh is just one of hundreds of money remitters tucked away in ethnic enclaves. The remitters offer a less formal and cheaper money-moving service for expatriate workers, combining their pay before sending the money overseas to avoid multiple transfer fees.
Such was the service Long Thanh ostensibly offered in the district nicknamed "little Saigon". Here, soup shops, men playing draughts and blaring Vietnamese pop songs provide a sense of home for the Asian community.
Yet it is alleged that many of Long Thanh's customers were not interested in saving on fees. Rather, they had money to burn. In court in late October, ACC investigators alleged the shop was frequented by figures from major Asian crime syndicates based in Victoria and NSW. One client, known as "Choc", allegedly visited Long Thanh's store in Bankstown, Sydney, twice a week to check that the money deposited matched that sent overseas. He is alleged to have ordered 90 transactions totalling $20 million.
The monitoring of facsimiles sent between the Victorian and NSW remitters was a key part of the ACC's investigation, especially as the suspects regularly switched mobile phones or talked in code to counter phone-taps. According to an ACC fact sheet tendered to court: "Intercepted facsimiles reveal that since December 2005, approximately $93 million has been transferred (by Long Thanh) to their businesses in Vietnam.
"The money is then transferred on to various groups in Cambodia, Hong Kong and other South-East Asian countries on behalf of clients of the money remittance business. It is believed that the majority of this total is the proceeds of drug importation and distribution operations."
Long Thanh allegedly used a range of methods to sidestep AUSTRAC's attention. The store's operators failed to lodge transaction records; they hid the identities of their clients and the overseas recipients; and they used other remitters to dilute the volume of money and the frequency with which it was sent offshore.
But, perhaps most ominously, Long Thanh also had its tentacles inside some major banks, as well as Vietnam Airlines. It is understood the ACC has concerns about some of the suburban bank employees who managed the remitter's accounts. An employee of the ANZ bank in the western suburbs is under scrutiny for her failure to report the extraordinary deposits and transfers made through Long Thanh's accounts. Questions are also being asked about employees from another major bank.
Authorities are also concerned about Long Thanh's relationship with members of flight crews working for Vietnam Airlines.
In court, it was revealed that an ACC surveillance crew targeted a Vietnam Airlines pilot, Van Dang Tran, after he flew into Sydney in early June. Within 24 hours, he was taking a phone call from a Long Thanh manager about "how many green tops" he could carry on his flight home. Tran responded that he could handle as much as possible.
A day later, during a routine search of the checked-in baggage belonging to the Vietnam Airlines air crew, Tran's suitcase was searched. Customs officers allegedly found 14 packages containing $549,265.
The find may have been the tip of the iceberg. The ACC later alleged in court that more than $10 million has flown out of the country as Long Thanh "used employees from Vietnam Airlines to remove large amounts of (drug) money from Australia".
Along with Tran and some of Long Thanh's employees, Taskforce Gordian has arrested more than 50 people in Australia over the past six months. Long Thanh's manager, Hang Thanh Huynh, is charged with conspiracy to launder up to $93 million of drug money overseas. A number of the company's clients have been charged with drug offences.
More arrests are planned, but the focus is shifting to the court cases, which are likely to be long and complex. Money laundering prosecutions in Australia have a poor success rate, partly because of the difficulty of proving that funds were "tainted" and those moving them knew it.
A November report by the International Monetary Fund states that "while the (Australian) legal measures are comprehensive, they are not fully effective, as investigators generally do not investigate and refer money laundering as a separate charge, and (the) number of prosecutions for money laundering is generally low".
Money launderings experts, such as former National Crime Authority chairman John Broome, blame a tendency for police and prosecutors to focus on "primary" crimes, rather than the movement of profits they generate. Taskforce Gordian, he says, may signal a welcome shift. But Mr Broome believes the anti-money laundering and terrorist financing reforms passed earlier this month still leave Australia vulnerable.
After September 11, scores of countries, including Australia, signed the Financial Action Task Force's new regime for fighting the black money trade.
Australia's new laws include boosts to AUSTRAC's resources and powers, and new rules for money remitters, banks, bullion dealers, accountants and casinos to report suspicious transactions and scrutinise customers.
After intense lobbying from business groups, especially the banks, the Government will phase the changes in over two years.
"A lot of banks have not been strongly compliant with existing rules, especially banks with branches in Asia and the Pacific," says Mr Broome.
"We have made some steps forward. But have we really got stuck into this stuff? The answer has to be no. For instance, I see no discernible crackdown on charities. And the phased approach means we won't see needed changes in place by 2009."
There are private rumblings among some senior police as to whether the new reforms go far enough given the negligible amount of terrorist funds seized in Australia.
Even with Gordian's concerted effort to track drug funds, the ease with which money moves overseas presents problems. Developing countries often do not have the expertise, laws or will to locate and seize dirty money.
According to public announcements, Gordian had seized less than 5 per cent of the drug dollars allegedly sent to South-East Asia.
It is, however, a work in progress. ACC officers have made numerous trips to Vietnam and are working closely with the country's authorities.
The money trail is not cold yet.
http://www.theage.com.au/news/national/exposed-multimilliondollar-drug-network/2006/12/22/1166290743054.html?page=fullpage#contentSwap1
on Sunday, December 10, 2006
December 09, 2006
Macau's prosecutors were Friday examining evidence to determine whether to charge detained disgraced former transport minister Ao Man-long with corruption.
Ao, 50, who was arrested last Wednesday, and 11 other suspects were taken to the prosecution office in handcuffs, where evidence was laid out before them. They face allegations of taking and receiving bribes and of laundering money overseas through a network of bank accounts to disguise the transactions.
Among the suspects were Ao's father Ao Wing-kwong, younger brother Ao Man-fu and a sister-in-law.
A statement from Macau's Commission Against Corruption, or CCAC, named the alleged bribers as a merchant surnamed Ho, a general manager surnamed Ioeng and an accountant surnamed Leung, of a company contracted for big construction projects.
Ao and another eight men and three women were arrested Wednesday night following more than 150 hours of investigations launched last week, the statement said.
"According to [the] source of information, the CCAC suspected that someone had abused his position and power in order to accept bribes. He [Ao] registered some shell companies abroad and cleaned the corrupt money in a secretive and zig-zag way through bank account networks," it alleged.
It said police conducted raids on the suspects' homes and offices and found more than HK$97,000 worth of Macau patacas and Hong Kong dollars. Police also confiscated contracts in newly bought apartments.
"Someone admitted opening bank accounts to operate illegal financial activities, during the investigation," it added.
The Independent Commission Against Corruption, which is cooperating in the investigation, refused to comment on, or confirm, that Hong Kong residents were among those arrested and that local bank accounts were being probed.
The merchant has been identified as Ho Meng-fai, president of San Meng Fai Engineering and Construction Company, one of the largest contractors in Macau.
Prior to the handover in 1999 San Meng Fai had not been involved in any government contract, but following the handover some 15 out of 24 construction projects conducted by the company, estimated to be worth at least HK$1 billion, had been awarded by the government, 12 of them by Ao's department.
A company spokesperson said San Meng Fai was one of the leading developers in Macau, responsible for many construction projects around the world, employing about 300 workers in Macau and at least 5,000 workers around the world.
According to the company Web site, San Meng Fai Engineering and Construction Company was established by Ho in 1982.
Describing the incident as heartbreaking, Macau Chief Executive Edmund Ho Hau-wah said the central government had agreed to the removal of Ao from official duties.
He stressed the government placed confidence in public servants and told them to look at the issue objectively, stay away from hearsay and stand by the facts, and be confident in the Judiciary to make a just judgment.
News of the arrests shocked the former Portuguese enclave, which has worked hard in recent years to shake off its reputation as a haven for gambling- related sleaze and criminality.
Since the handover central and local authorities have clamped down on loan sharks, pimps and triad gangs that flourished under Lisbon's lax control.
If Ao is charged, the case will be sent straight to the Court of Final Appeal due to his senior rank, in accordance with Macau law.
http://www.thestandard.com.hk/news_detail.asp?pp_cat=11&art_id=33735&sid=11267427&con_type=1
Macau's prosecutors were Friday examining evidence to determine whether to charge detained disgraced former transport minister Ao Man-long with corruption.
Ao, 50, who was arrested last Wednesday, and 11 other suspects were taken to the prosecution office in handcuffs, where evidence was laid out before them. They face allegations of taking and receiving bribes and of laundering money overseas through a network of bank accounts to disguise the transactions.
Among the suspects were Ao's father Ao Wing-kwong, younger brother Ao Man-fu and a sister-in-law.
A statement from Macau's Commission Against Corruption, or CCAC, named the alleged bribers as a merchant surnamed Ho, a general manager surnamed Ioeng and an accountant surnamed Leung, of a company contracted for big construction projects.
Ao and another eight men and three women were arrested Wednesday night following more than 150 hours of investigations launched last week, the statement said.
"According to [the] source of information, the CCAC suspected that someone had abused his position and power in order to accept bribes. He [Ao] registered some shell companies abroad and cleaned the corrupt money in a secretive and zig-zag way through bank account networks," it alleged.
It said police conducted raids on the suspects' homes and offices and found more than HK$97,000 worth of Macau patacas and Hong Kong dollars. Police also confiscated contracts in newly bought apartments.
"Someone admitted opening bank accounts to operate illegal financial activities, during the investigation," it added.
The Independent Commission Against Corruption, which is cooperating in the investigation, refused to comment on, or confirm, that Hong Kong residents were among those arrested and that local bank accounts were being probed.
The merchant has been identified as Ho Meng-fai, president of San Meng Fai Engineering and Construction Company, one of the largest contractors in Macau.
Prior to the handover in 1999 San Meng Fai had not been involved in any government contract, but following the handover some 15 out of 24 construction projects conducted by the company, estimated to be worth at least HK$1 billion, had been awarded by the government, 12 of them by Ao's department.
A company spokesperson said San Meng Fai was one of the leading developers in Macau, responsible for many construction projects around the world, employing about 300 workers in Macau and at least 5,000 workers around the world.
According to the company Web site, San Meng Fai Engineering and Construction Company was established by Ho in 1982.
Describing the incident as heartbreaking, Macau Chief Executive Edmund Ho Hau-wah said the central government had agreed to the removal of Ao from official duties.
He stressed the government placed confidence in public servants and told them to look at the issue objectively, stay away from hearsay and stand by the facts, and be confident in the Judiciary to make a just judgment.
News of the arrests shocked the former Portuguese enclave, which has worked hard in recent years to shake off its reputation as a haven for gambling- related sleaze and criminality.
Since the handover central and local authorities have clamped down on loan sharks, pimps and triad gangs that flourished under Lisbon's lax control.
If Ao is charged, the case will be sent straight to the Court of Final Appeal due to his senior rank, in accordance with Macau law.
http://www.thestandard.com.hk/news_detail.asp?pp_cat=11&art_id=33735&sid=11267427&con_type=1
Subscribe to:
Posts (Atom)
