Money laundering is criminal offence under the Laws of Hong Kong.

Under section 25(1) of the Drug Trafficking (Recovery of Proceeds) Ordinance, Cap. 405 and section 25(1) of the Organized and Serious Crimes Ordinance, Cap. 455, money laundering is an offence for a person who, knowing or having reasonable grounds to believe that any property in whole or in part directly or indirectly represents any person’s proceeds of drug trafficking or an indictable offence, deals with that property.

 

Maximum penalty is a HK$5,000,000 fine and 14-year imprisonment.

In the cases of HCMA 454/2005 and HCMA 1070/2005, the defendants were convicted of money laundering offence by offering their bank accounts for receipt of money with reasonable grounds to believe that the money in whole or in part directly or indirectly represented any person’s proceeds of a crime.

 

AMLO

On 1 April 2012, the Hong Kong Anti-Money Laundering and Counter-Terrorist Financing (Financial Institutions) Ordinance, Cap. 615 (the “AMLO”) came into effect.

 

This ordinance has codified the customer due diligence and record keeping requirements into law in order to create the statutory obligation for the financial institutions.

 

A financial institution or its management staff may be convicted criminal offences for contravention of a specific provision or knowingly permitting the financial institution to contravene a specific provision.

The maximum penalty is a HK$1,000,000 fine and 2-year penalty.

 

If a financial institution contravenes a specific provision with the intent to defraud any regulatory authority or a person contravenes a specific provision with the intent to defraud any regulatory authority or the financial institution, the maximum penalty is a HK$1,000,000 fine and 7-year penalty.