The third round of the mutual evaluation of the Asia/Pacific Group on Money Laundering is scheduled for the end of 2018. To harmonize Taiwan's regulations with international standards, Taiwan amended the Money Laundering Control Act and then promulgated it on December 28, 2016. The Act became effective June 28, 2017. The amendments are to prevent Taiwan from being classified as a high-risk jurisdiction and facilitate its participation in international trade. The following is a summary of the amendments:
1.Broader Definition of Money Laundering
(1)The definition of money laundering has been widened to encompass all stages of money laundering, including the disposal, concealment, or disguising of the true nature of, unlawful proceeds, and the receipt of such proceeds (Article 2). All stages of such criminal activities are now subject to sanctions (Article 14).
(2)The definition of specified criminal activities (offences that lead to money laundering) now encompasses crimes punishable by a minimum of six months' imprisonment instead of five years. The NT$ 5 million unlawful proceeds minimum, another constituent element of a specified criminal activity, was eliminated. Furthermore, specified criminal activities now include offenses described in Articles 95 and 96 of the Trademark Act, Articles 41, 42, 43.1 and 43.2 of the Tax Collection Act, and Articles 45.1.3 and 45.1.47 of the Waste Disposal Act(Article 3).
(3)The definition of unlawful proceeds now includes the property, or assets converted from the property, or the interests, obtained or derived from the specified criminal activities. When verifying whether certain property constitutes unlawful proceeds, a guilty conviction of the suspected criminal activity is no longer the only criterion (Article 4). Such property is to be confiscated (Article 18.1).
(4)Money laundering crimes now include accepting, possessing, or using property, or the assets converted from property, that is obtained from a dubious source or that is not commensurate with the income of the suspect, along with the following elements: (1) using other people's names or using fake names to open accounts at financial institutions; (2) obtaining accounts opened by others at financial institutions via improper means; and (3) circumventing money laundering procedures (Article 15). Such property or any interests derived from the property are to be confiscated (Article 18.1).
(5)The targets subject to confiscation have been increased. When a criminal ring is found to have committed a crime under Article 14 or 15, and proceeds from unknown sources are uncovered at the same time, if there is evidence that the proceeds are the fruit of unlawful activities, such proceeds should be confiscated (Article 18.2). For example, cash from unknown sources found in scam groups' warehouses is subject to confiscation.
2.Better Asset Tracing
Financial institutions and non-financial businesses or professions (e.g., financial leasing enterprises, lawyers, accountants, notaries public, real estate brokers, trust enterprises, and jewelers) are the first line of defense against money laundering (Article 5). They are responsible for confirming the identities of high-risk clients and preserving the personal information and transaction records of such customers for at least five years (Articles 7 & 8). For high-profile clients such as politicians, or their family members or close associates, a more rigorous review procedure should be implemented.
3.Greater International Cooperation:
Strengthening judicial assistance cooperation with other countries (Article 19) and helping to implement financial countermeasures (Article 11) are new objectives.
4.Improved Anti-Money Laundering Training:
More rigorous internal control procedures and training against money laundering for financial and designated non-financial businesses or personnel are to be implemented (Article 6). The Ministry of Justice has set up a fund to combat money laundering (Article 20).