AML/CFT Law Enforcement Agencies in Hong Kong

STR Lifecycle and Documentation in Hong Kong

The Suspicious Transaction Report (STR) follows a comprehensive process, called the SAFE approach, that ensures AML/CFT legal compliance and ML investigations. The STR reporting flow in Hong Kong goes as follows:

Screen: Recognise the red flags or suspicious activity indicators.

Ask: Staff must ask the customer relevant questions when their activities or transactions appear suspicious.

Find: Regulated Entities should review existing customer records and known information to determine whether the identified behaviour is truly suspicious.

Evaluate: Lastly, entities should analyse all the information gathered and decide whether to complete an STR.

STR must be filed when entities have suspicion or knowledge of money laundering or terrorist financing crimes to an authorised officer (JFIU) as soon as it is practicable. Further, the documentation includes personal particulars, activity details, reason for suspicion and customer explanation of the transaction.

Regulated entities must submit STR through the STREAMS 2 electronic system. Entities other than the regulated entities can submit the STR Proforma by email to JFIU.

STR is a primary tool which enables Hong Kong AML/CFT Law Enforcement Agencies to counter money laundering and terrorist financing.

How to Protect Privilege and Confidentiality

The obligation to submit STR overrides the clients’ rights to confidentiality. This means that the submission of STR to the JFIU is not a breach of client confidentiality, and the person making the report cannot be sued for privacy breaches and damages.

The JFIU keeps reports confidential and handles them on a “need to know” basis. Regulated entities must not provide information to customers about STR filing, as under DTROP and OSCO, it’s an offence to publish or broadcast information revealing STR.

How AML Consultants HK Helps Meet Reporting Requirements in Hong Kong

AML Consultants HK helps regulated entities design AML/CFT systems that involve documented policies & procedures for filing STRs. AML Consultants HK provides staff AML/CFT training about detecting unusual transaction patterns and suspicious activity to meet the expectations of Hong Kong AML law enforcement agencies and ensure compliance with AMLO obligations. Additionally, AML Consultants HK provides AML regulatory reporting support that includes preparing suspicious transaction reports and submitting them to JFIU through the STREAMS 2 system.