IMF, WB Urge Vietnam to Launch Money Laundering Decree

IMF, WB Urge Vietnam to Launch Money Laundering Decree

Financial experts from the International Monetary Fund (IMF) and the World Bank (WB) March 22 called on Vietnam to quickly issue a money laundering decree to prevent the crime, which has emerged in the country.

Because Vietnam is at a “crossroads”, ignoring the issue would create a perfect place for money laundering to flourish, said Susan J. Adams, Senior Resident Representative of the IMF Hanoi Office in an international seminar on money laundering and terrorist financing in Hanoi.

The State Bank of Vietnam (SBV), Vietnam's central bank, has formulated a decree and submitted it to the government for approval, but no fixed date of release is available.

Delay over its release would evoke concerns from international financial organizations over transactions with Vietnamese banks or financial institutions, said Peter Skonka, an IMF expert.

Vietcombank, the country’s largest commercial bank, said at the seminar that the lack of a law against money laundering has put obstacles in its way as it moves to establish business relations with foreign banks and has to answer questions over banking security in Vietnam.

Money laundering has already emerged in Vietnam as a result of graft or smuggling, Mai The Bay, a prosecutor at Vietnam Supreme People’s Procuracy, said at the seminar.

Mr. Bay said those who earn dirty money from corruption or smuggling, and then use the money to buy land or other properties should be charged with money laundering.

However, he said it is hard to crack down on the crime in Vietnam as no definition of “money-laundering” exists in any legal document, and no consensus of viewpoints over the issue has been reached.

Another problem for Vietnam is that laws are enforced such that there is “one charge for each offence”, he said. For example, a corrupt official that purchases properties with graft money would only be charged with corruption, and his properties confiscated, he said.

The United Nations and other organizations have recommended that these offences be separate, said Mr. Skonka. “In the US, money laundering would be considered more serious then the offences that result from it,” he said.

He said a decree to prevent money laundering would allow judges and investigators legal ground to prosecute the offence.

At the seminar, Nguyen Dang Hong, an SBV official gave a brief introduction on the money laundering decree that has been submitted to the government for approval.

He said the decree covers financial transactions worth over VND200 million (nearly $12,700), and deposits of more than VND500 million ($31,700) to be reported to authorized agencies to detect money laundering.

The decree also clarifies regulations on 13 “suspected transactions”, he said.

Information about suspected transactions would be transferred to the SBV’s money laundering prevention center, and referred to investigative agencies, Mr. Hong said. 

• P.V