The Statutory Requirements
Under the Drug Trafficking (Recovery of Proceeds) Ordinance (Chapter 405), the Organized and Serious Crimes Ordinance (Chapter 455), and the United Nations (Anti-Terrorism Measures) Ordinance (Chapter 575), when a person knows or suspects that any property represents proceeds of drug trafficking or an indictable offence, or is terrorist property, a disclosure must be made to the Joint Financial Intelligence Unit (JFIU) of the Hong Kong Police as soon as it is reasonable to do so. These obligations apply to any person, including a company and every officer of a company. Failure to report such knowledge or suspicion is a criminal offence and may be liable on conviction to a fine and to imprisonment.
Adopting the “SAFE” Approach
Implementing an effective systemic approach to identify suspicious transactions will safeguard you and your company from the risk of being involved with money laundering and terrorist financing. You may adopt, where applicable, the “SAFE” approach as recommended by JFIU in identifying and reporting suspicious transactions. Four steps are involved in the SAFE approach:
Screen the relevant account for suspicious indicators
Ask the customer appropriate questions
Find out the customer’s records
Evaluate all the above information
Details of the SAFE approach are available at JFIU’s website (www.jfiu.gov.hk).
How to submit a Suspicious Transaction Report (STR)?
You are strongly encouraged to use the STR proforma or the e-reporting system named Suspicious Transaction Report and Management System (STREAMS) to report suspicious transactions. Please visit JFIU’s website at www.jfiu.gov.hk for full details of the reporting methods and advice.