Hong Kong has become the source of the financial and other services of the rapid and sustainable economic growth that Asia-Pacific countries have entered since the 1970s, which has been realized with industrial investments, industrialization and direct foreign capital investments. Hong Kong has developed as a center for trade, transportation, transportation and communication between other parts of the world, regional points and countries in the region.
Hong Kong has provided a very suitable economic environment for foreign investors who aim to meet the financing needs of Asia-Pacific countries and also want to provide other services and want to make direct capital investments in these countries. In the last 10 years, the first point in the efforts of the countries in the region to internationalize their financial systems is the Hong Kong financial markets. International financial institutions that produce products between the international financial markets of Hong Kong and the financial markets of the countries in the region continue to come.
Like regions and countries all over the world, Hong Kong faces threats of money laundering and terrorist financing. Financial crimes have too many negative effects on financial systems. As a financial center, Hong Kong has effective AML laws and regulations to combat financial crime. Some of the legislation in force in Hong Kong to combat financial crime include Anti-Money Laundering and Counter-Terrorist Financing Ordinance (AMLO), the Drug Trafficking (Recovery of Proceeds) Ordinance (DTROP), the Organized and Serious Crimes Ordinance (OSCO), There are the United Nations (Anti-Terrorism Measures) Ordinance (UNATMO) and the United Nations Sanctions Ordinance (UNSO). These laws are created by the Hong Kong Financial Regulator.
Banks, financial institutions, insurance agents and accounting firms operating in Hong Kong are subject to AML regulations and must comply with AML obligations. Some of these AML obligations are "Customer Due Diligence" and "Record Keeping". Customer Due Diligence procedures are the controls that companies should apply when starting a business relationship with a customer. With these controls, a risk assessment is applied to the customer. When conducting a customer risk assessment, Know Your Customer procedures are applied first and the customer's information is collected. After checking the accuracy of customer information, CDD procedures begin to be implemented.
One of the controls applied for risk assessment is sanction, PEP and adverse media screening. People mentioned in Sanction, PEP and adverse media data are high-risk customer profiles for companies. Therefore, companies must check the customer on these data before starting a business relationship with a customer. Also, If any suspicious activity of customers is detected in financial institutions, they should report this suspicious transaction report in Hong Kong.
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