China Focuses on Virtual Assets in New Anti-Money Laundering Measures

China’s Supreme People’s Court and Supreme People’s Procuratorate have issued new measures to address anti-money laundering laws. From the 20th of August, 2024 the legal interpretation provides for very rigorous conditions concerning the prosecution of money laundering-related offences.

China’s Supreme People’s Court and Supreme People’s Procuratorate have jointly issued new measures to strengthen the application of anti-money laundering laws.

The legal interpretation, set to take effect on August 20, 2024, outlines stringent conditions for prosecuting money laundering-related offenses.

China to Focus on Virtual Assets in Money Laundering Cases

The new guidelines specifically identify virtual asset transactions as a method used to conceal the proceeds of crime, closing a previous legal gap. This move highlights China's ongoing efforts to address the growing virtual asset market and emerging financial crimes.

The Supreme Court and Supreme Procuratorate included "virtual asset" transactions in their interpretation of the Criminal Law as a way of laundering money. In the first half of 2024, 1,391 people were charged with money laundering, up 28.4% year-on-year.

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— Wu Blockchain (@WuBlockchain) August 19, 2024

According to the interpretation, virtual asset transactions can be deemed as acts of “suppressing and hiding the source” of criminal funds. The guidelines also define what constitutes “serious circumstances” in money laundering cases, such as laundering over 5 million yuan or causing losses exceeding 2.5 million yuan.

China to Step Up Legal Framework to Combat Financial Crimes

These measures are part of China's broader strategy to strengthen its legal system in combating financial crimes, specifically:

Surging Money Laundering Prosecutions

Chinese authorities have ramped up prosecutions for money laundering offenses, with nearly 3,000 cases handled in 2023. This marks a 20-fold increase compared to 2019, showcasing the country's heightened efforts against money laundering activities. In the first half of 2024, the number of prosecutions surged by 28.4%, indicating sustained efforts in the fight against financial crimes.

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