“Rule-based but risk-oriented” approach for combating money laundering in Chinese financial sectors

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Journal of Money Laundering Control

ISSN: 1368-5201

Online from: 1997

Subject Area: Accounting and Finance

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Document Information:
Title:	“Rule-based but risk-oriented” approach for combating money laundering in Chinese financial sectors
Author(s):	Lishan Ai, (Centre for Transnational Crime Prevention, University of Wollongong, Wollongong, Australia)
Citation:	Lishan Ai, (2012) "“Rule-based but risk-oriented” approach for combating money laundering in Chinese financial sectors", Journal of Money Laundering Control, Vol. 15 Iss: 2, pp.198 - 209
Keywords:	China, Financial services, Money laundering, Risk management, Risk-based approach
Article type:	Viewpoint
DOI:	10.1108/13685201211218225 (Permanent URL)
Publisher:	Emerald Group Publishing Limited
Abstract:	Purpose – This paper attempts to examine the practical condition of implementing risk-based approach (RBA) in Chinese financial sectors. Design/methodology/approach – This paper compares the differences between rule-based approach and risk-based approach (RBA), and provides different options to financial institutions considering their own circumstances. Findings – This paper finds that capacity constraint is an issue for directly transplanting the RBA performed by developed countries to Chinese financial institutions. Originality/value – This paper creatively proposes a rule-based but risk-oriented AML approach or partial RBA that fits Chinese financial institutions' reality underpinned by Chinese culture, and correspondingly, different assessment methods are presented as well.