The Securities and Futures Commission (SFC) today launched a consultation (Note 1) on proposals to amend the Financing Guidelines on Anti-Money Laundering and Counter-Terrorist Financing to keep it in line with international anti-money laundering and counter-financing of terrorism (AML/CFT) standards (Note 2) and make it more useful and relevant.
The proposed amendments expand the types of politically exposed persons to include customers who have been entrusted with a prominent function by an international organisation (Note 3).
The SFC has also proposed to streamline the identification and verification processes for onboarding customers to allow flexibility for licensed corporations to adopt reasonable risk-based measures and determine the extent to which each individual’s identification information would need to be verified. Licensed corporations may use appropriate technology for non-face-to-face account opening if they can ensure and demonstrate that there are adequate safeguards against impersonation risk.
“The SFC is committed to adhering to international AML/CFT standards to reinforce Hong Kong’s reputation as a major international financial centre,” said Mr Ashley Alder, the SFC’s Chief Executive Officer. “In formulating the proposed amendments, we adopted a balanced regulatory approach to give firms flexibility while ensuring our requirements are effective to prevent money laundering and terrorist financing.”
- The consultation paper seeks comments from the public on the amendment proposals and the indicative drafts of the proposed revised Guideline on Anti-Money Laundering and Counter-Terrorist Financing and the proposed revised Prevention of Money Laundering and Terrorist Financing Guideline issued by the Securities and Futures Commission for Associated Entities.
- International AML/CFT standards mainly comprise the AML/CFT requirements as promulgated by the Financial Action Task Force (FATF), an inter-governmental body which sets international standards for combating money laundering, terrorist financing and the financing of the proliferation of weapons of mass destruction. Hong Kong has been a member of the FATF since 1991, and will undergo a mutual evaluation, scheduled for November 2018, conducted by other FATF member jurisdictions of the implementation of the FATF standards in Hong Kong.
- The term “international organisation” is defined in the Glossary of the FATF Recommendations. Some examples are the United Nations, International Maritime Organization and World Trade Organization.