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WEDNESDAY, DECEMBER 1, 1993
THE BILLS WILL BE INTRODUCED INTO THE LEGISLATIVE COUNCIL ON DECEMBER 15.
THE DRUG TRAFFICKING (RECOVERY OF PROCEEDS) ORDINANCE, WHICH CAME INTO FORCE IN SEPTEMBER 1989, PRESCRIBES THAT DRUG MONEY LAUNDERING CONSTITUTES A CRIMINAL OFFENCE AND CONTAINS PROVISIONS FOR TRACING, FREEZING AND CONFISCATING DRUG TRAFFICKING PROCEEDS.
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THE FINANCIAL ACTION TASK FORCE (FATE), AN INTERNATIONAL BODY ESTABLISHED IN 1989, HAS PUT FORWARD 40 RECOMMENDATIONS AIMED AT MEASURES TO STRENGTHEN LOCAL EFFORTS AND INTERNATIONAL CO-OPERATION IN FIGHTING DRUG MONEY LAUNDERING.
FATF RECOMMENDS THAT FINANCIAL INSTITUTIONS SHOULD DEVELOP MEASURES AGAINST MONEY LAUNDERING SUCH AS INTERNAL ANTI-MONEY LAUNDERING POLICIES, PROCEDURES AND CONTROLS AND ON-GOING EMPLOYEE
TRAINING.
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IN HONG KONG, THE MONETARY AUTHORITY HAS ISSUED GUIDELINES PROCEDURES TO BE FOLLOWED BY AUTHORISED INSTITUTIONS IN COUNTERING AND REPORTING SUSPECTED MONEY LAUNDERING TRANSACTIONS.
BREACHES OF GUIDELINES MAY LEAD TO DISCIPLINARY PROCEEDINGS.
LAW
"THE SECURITIES AND FUTURES COMMISSION (SFC) WILL PROMULGATE RULES FOR THE SAME PURPOSES AND UNCERTAINTIES UNDER THE EXISTING WILL HAVE TO BE REMOVED TO FACILITATE THE PROCESS, MR TAM SAID.
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THE SECURITIES ORDINANCE EMPOWERS THE SFC TO MAKE RULES IN RESPECT OF THE CONDUCT OF BUSINESS OF PERSONS REGISTERED UNDER THE ORDINANCE.
THERE IS NO CORRESPONDING PROVISION IN THE COMMODITIES TRADING ORDINANCE. THE COMMODITIES TRADING (AMENDMENT) BILL WILL RECTIFY THIS DISPARITY.
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UNDER THE SECURITIES ORDINANCE, THE SFC CAN ALSO TAKE ACTION AGAINST A REGISTERED PERSON FOUNDS, INTER ALIA, GUILTY OF MISCONDUCT.
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POSSIBLE ACTIONS INCLUDE A REGISTRATION OR A REPRIMAND.
REVOCATION OR SUSPENSION
OF
RULES
IT IS UNCERTAIN WHETHER MISCONDUCT INCLUDES A BREACH OF MADE BY THE SFC SUCH AS THOSE RELATING TO DRUG MONEY LAUNDERING. SIMILAR POTENTIAL AMBIGUITIES ALSO EXIST IN THE COMMODITIES TRADING ORDINANCE.
"TO ENSURE THAT HONG KONG CAN IMPLEMENT THE FATF RECOMMENDATIONS IN RELATION TO INSTITUTIONS IN THE SECURITIES AND FUTURES INDUSTRIES, THE BILLS WILL CLARIFY THAT FAILURE TO COMPLY WITH RULES MADE BY THE SFC CONSTITUTES A 'MISCONDUCT', MR TAM SAID.
"THE AMENDMENTS CONTEMPLATED, THOUGH SIMPLE IN NATURE, WILL
FOR
MAKE SURE THAT THE SFC CAN EFFECTIVELY ENFORCE RULES TO BE MADE THE COMBAT AGAINST DRUG MONEY LAUNDERING IN THE SECURITIES AND FUTURES MARKETS," MR TAM ADDED.
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