A better coordinated and sophisticated network against money laundering is to be established in China.
As the country speeds up its first anti-money laundering law, China's central bank says its monitoring will be expanded from the banking to the securities and insurance sectors. This move has been hailed by a leading Chinese economist, who says such a system can better protect the interests of financial institutions in China. CRI's Qiu Wei has more.
In 2003, China's central bank, the People's Bank of China promulgated anti-money laundering rules for financial institutions, which demand the monitoring of suspicious transactions.
Now, in addition to urging banks to implement such rules rigorously, China's central bank is drafting regulations to tackle money laundering in the securities and insurance sectors.
An economist with the dept of finance and securities at Beijing-based Renmin University, Zhao Xijun, says that apart from the further opening up of China's financial sector, the expansion of such central bank monitoring will be beneficial to the formation of a comprehensive financial security network.
"Foreign finance coming into China is not limited to the banking sector. The existing law doesn't cover areas outside that sector. Therefore, there is a gap when it comes to regulation. The latest move which plans to expand monitoring to the securities and insurance industries will complete the network safeguarding financial security."
The definition of money laundering in China's Criminal Law only covers attempts to conceal the true sources of so called "dirty" money connected to drug trafficking, smuggling, terrorism and other activities of underground societies.
This narrow legal definition hinders money laundering investigators in tracking suspected "dirty money" effectively and also the police in their efforts to seek international assistance in chasing suspects.
According to the People's Bank of China, relevant departments are drafting regulations to bring occupational sectors such as lawyers, accountants, auctioneers and real estate agents, within the scope of their monitoring.
Economist Zhao Xijun regards that the move to broaden monitoring of suspected transactions along with the new anti-money laundering law will lead to an effective and comprehensive network to tackling this crime.
"Money laundering has an international character. Our efforts to build such a network of safeguards against money laundering can better protect us. Meanwhile, it also has the aim of fulfilling our international obligations to protect the interests of other countries."
A report on China's anti-money laundering efforts in 2004, published by China's central bank in July, reflects the country's escalating efforts to combat this scourge.
China became an observer of the Financial Action Task Force on Anti-Money Laundering in January this year. It aims to become a member of the group next year.
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Xie Qiao 
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