According to updated HKMA guidance, suspected breaches of the national security law should be treated the same as AML/CFT violations and be reported to the JFIU as STRs.
The HKMA (Hong Kong Monetary Authority) has issued an advisory to financial institutions introducing obligations for them to report suspected breaches of the national security law to the police.
The new national security law was imposed by mainland authorities in Hong Kong on 1 July, criminalising secession, terrorism, subversion and collusion with foreign powers.
According to an updated set of FAQs published on the HKMA’s website breaches of the national security law should be treated the same as violations of AML/CFT regulations.
The reporting obligations are triggered when a bank “knows or suspects that any property is offence-related property”, and should follow the same procedures as used to file STRs (suspicious transaction reports) with the JFIU (Joint Financial Intelligence Unit).
The HKMA says a technical enhancement is being made by the JFIU in its STREAMS platform to add a box “National Security Law” under the “Reason for Disclosure” column in the STR Proforma.
Until the enhancement is made, financial institutions are asked to click the box of “OSCO” (Organized and Serious Crimes Ordinance) in the “Reason for Disclosure” column and the box of “Other” in Suspected Crime column, while also inputting “National Security Law” in the first line under the “additional information” column.
The reporting obligation applies to both local and international banks in Hong Kong.
Any requests for information about customer accounts at branches or subsidiaries in other jurisdictions will be made by law enforcement agencies through the Mutual Legal Assistance Unit of the International Law Division of the Department of Justice.
The advisory, available here, was authored by the HKAB (Hong Kong Association of Banks).