Members of the second standing committee currently discussing the new law proposal for countering money laundering and terrorist activities financing disagree with the government in terms of the penalties and responsibility employees should bear in the event of negligence related to money laundering.
The statements were made by the Legislative Assembly’s (AL) second standing committee chairman, Chan Chak Mo, following a meeting yesterday on the law to update the original legislation enacted in 2006.
According to the legislator the original law change proposal that was voted on favourably in the AL in November of last year comprised 31 Articles, with the committee having proposed a version with 73 Articles, to which the government countered with 52 Articles in April.
The committee members claim the Articles defining the responsibility for collective entities found guilty of money laundering crimes do not specify what disciplinary measures would be taken in the event employees of companies are found guilty of negligence in their duties.
The law proposal states that entities have the responsibility to identify and verify the identity of their clients; conduct measures to detect operations of money laundering; refuse to provide operations that refuse to provide information and inform the authorities of the activities.
The law proposal states that members of an organisation or an unincorporated association could be considered guilty if an action of money laundering was made possible by their negligence.
The committee states the government announces seven penalties, including administrative penalties such as fines and disciplinary responsibility for how employees should be penalised although their application and the criteria to assess the employee’s responsibility is not clear.
“If the employee works for the government does it still make sense for the government to fine him? It feels like the money just changes hands between the government. What disciplinary sanctions would public employee suffer? We need to clarify this with the government,” the chairman added.
He also said clarifications were needed on the line where the infractions would pass from disciplinary action to criminal investigation.
Despite that issue Mr. Chan said there were few disagreements with the government, with the majority of the two-hour meeting being for the presentation of many of the law proposal Articles.
“We will collect the government’s opinions and come out with another proposal (…) If the government hears our suggestions [I] believe after three or four more meetings we can finish the preparations and submit a proposal to the Legislative Assembly. We have to finish our work before October 15,” he added.
The legislator said that the second standing committee is currently evaluating four law proposals but that the work could be finalised “around August”.
The second committee chairman also stated that the government was asked for the law to specify the MSAR budget be sent for debate by the AL at least 45 days before the Chief Executive’s annual Governance Action Lines (LAG) address in order to allow more time for its evaluation.
“The government normally presents the budget to us on November 30 (…) We understand the difficulties of the government setting a date but we hope there is more time to give the AL more time to evaluate the budget,” Mr. Chan said.