Vietnamese banks should urgently classify depositors to prevent money laundering.
Dr. Nguyen Tri Hieu, an independent member of the Management Board of ABBank, said the depositor classification has been done in many countries, but no bank in Vietnam had yet to adopt the policy.
| Vietnamese banks should urgently classify depositors to prevent money laundering.
“A black list of depositors should be made, depending on their risks. For example, the lowest-risk group are state employees and small traders; while the highest-risk group include real estate investors, cross-border traders, gold importers and gamblers must be frequently supervised by banks,” he proposed.
Some economists said, foreign banks operating in Vietnam face less risks of money laundering than domestically-invested institutions because they pay more attention to preventive measures.
The National Assembly approved the Money Laundering Prevention Law in June, which is expected to provide a firm foundation for Vietnam to control money laundering activities. However, experts said the State Bank of Vietnam needs to have strict sanctions to force commercial banks to invest in tools to prevent money laundering. This may prove a major challenge as this would require investments of around USD1 million.
Under Decree 74/2005/ND-CP on money laundering prevention and control, credit organisations have to supervise and inform the State Bank of Vietnam of suspected cases, particularly transactions of over VND200 million (USD9,500) in cash or VND500 million (USD23,800) or more in deposits. The report must be made no later than 48 hours through documents, emails or even phone calls.
However, despite the circular being issued, banks were afraid of losing customers, and in reality, only a small number of banks have conformed with the circular. The circular has been in effect for seven years, however, only a few money laundering cases have been detected to date.
Dr. Nguyen Tri Hieu warned that Vietnamese habits of using cash and loose control by local banks over deposits have offered ideal opportunities for money laundering.
Nguyen Van Ngoc, Head of the Anti-Money Laundering Information Centre under the State Bank of Vietnam said the detection and elimination of money laundering activities in Vietnam was mainly conducted through banks, but few institutions took the work seriously.
Le Nhu Duong, Head of the Anti-money Laundering Department at Vietcombank, said, few banks have paid due attention to preventing and controlling money laundering activities. However, so far this year, Vietcombank has concentrated more on the issue and detected tens of billions of VND being moved in suspicious circumstances.