Vietnam Declares War against Cash Laundering 

The State Bank of Vietnam (SBV) has recently submitted to the Government a draft anti-money laundering decree which focuses on the establishment of a specialized center and defines 13 types of transaction considered illegal.

The Asia Development Bank quotes a source from the International Monetary Fund (IMF) saying the total amount of legalized money globally accounts for around 2-5 percent of the world’s GDP. Though Vietnam has yet revealed official figures it is still considered a cash-based economy, an ideal environment for this crime. Vietnam should keep alert over laundering crimes or its financial system will sooner or later collapse once they penetrate in, stresses Susan J.Adams, senior resident representative of IMF. The country’s economy will consequently be broken down, she says.

The draft anti-money laundering decree is considered the first important step in this fight. Nguyen Dang Hong, Vice Chief Inspector of SBV, reveals that the bank is planning to set up an information centre for anti-money laundering (or bureau of financial intelligence), aiming to build up a legal corridor for transactions in the financial market and making the investment environment healthy. The centre will update and analyze related information to assist investigation units in the fight against financial and monetary crimes. It will also help relevant organizations in policy making and international cooperation in anti-money laundering. 

One of the most controversial points of the decree, which regulates that transactions in cash must be reported, has come to consent. Accordingly, transactions in cash which reach VND200 million (or equivalent in gold or in foreign currency) and deposit worth from VND500 million upward must be reported. Anti-money laundering laws of many countries regulate the must-be-reported level of US$10,000, lower than that of Vietnam, Hong points out. However, in many countries, the private assets are strictly managed under the law. The draft also regulates 13 types of transactions considered illegal which will be periodically supplemented in documents with other suspicious types.

Temporary measures for anti-money laundering include prohibiting transactions, freezing accounts, sealing up or detaining assets, detaining violators and some others in line with the law.

ADB says Vietnam belongs to the group of countries facing average anti-money laundering risk. The investment opportunities of Vietnam will reach higher if the financial source of Vietnam is better controlled, less corrupted expenses and lower interest rate (equal to less risk). This means Vietnam must complete a legal framework for anti-money laundering. The SBV has reportedly prepared specific circulars and regulations on the functions, tasks and rights of the centre for anti-money laundering to ensure the highest efficiency once the decree is promulgated.

• Giang Tu