What is the legal framework for AML in China?
The AML Law in force today is the 2024 revision of the Anti Money Laundering Law of the People's Republic of China (中华人民共和国反洗钱法), not the text first adopted on 31 October 2006. The revision of 8 November 2024 has applied since 1 January 2025 (art. 65). Its 65 articles cover terrorist financing too, unless another law provides otherwise (art. 2).
China's AML laws and regulations sit in layers. Below the law, the PBOC issues orders called measures (办法), several of them jointly:
- CDD Measures, Order 2025 No. 11, with the NFRA and the CSRC, in force 1 January 2026.
- Beneficial Owner Identification Measures, Order 2025 No. 12, in force 20 January 2026.
- Special Preventive Measures, Order 2026 No. 1, issued with seven other national bodies, in force 16 February 2026.
- Reporting Measures, Order 2016 No. 3, last amended by Order 2025 No. 10 from 1 December 2025.
Every PRC article cited here was read in Chinese on the NPC, SAMR, PBOC and gov.cn sites on 4 November 2026.
How does Chinese criminal law define money laundering?
Criminal Law art. 191, rewritten by Amendment XI (in force 1 March 2021), sets the test for the determination of the offense: hiding the source and nature of proceeds from seven crime groups (drugs, organized crime, terrorism, smuggling, corruption and bribery, crimes against financial order, financial fraud). Five acts count: providing an account, converting property into cash, financial instruments or securities, moving funds by transfer or other payment methods, moving assets across borders, or any other means. The penalties table below gives the sentences. The AML Law's perspective is wider: its art. 2 adds "other crimes".
Who regulates AML in China? The People's Bank of China and its role
The PBOC (中国人民银行) holds the role the law gives the State Council's AML administrative department, the competent authority for AML supervision nationwide (art. 5); Order 2025 No. 10 names it in that role. Under art. 13 its responsibilities are AML coordination, funds monitoring, rules for financial institutions, supervision of their duties and investigation of suspicious transactions within its remit.
| Body (in force, November 2026) | AML role | Basis |
|---|---|---|
| CAMLMAC (中国反洗钱监测分析中心) | Receives and analyzes large value and suspicious reports; may ask for more information | AML Law art. 16; Reporting Measures art. 23 |
| National Financial Regulatory Administration (NFRA), built on the former China Banking and Insurance Regulatory Commission (CBIRC) | AML checks when it admits banks and insurers; passes leads on breaches to the PBOC | AML Law art. 14; reform plan of 16 March 2023 |
| China Securities Regulatory Commission (CSRC) | The same for securities, fund and futures firms | AML Law art. 14 |
| SAFE, the foreign exchange regulator | Sets cash declaration rules with the PBOC and the General Administration of Customs | AML Law art. 18 |
| SAMR and local registration authorities | Take beneficial owner filings and pass them to the PBOC | BO Information Measures art. 4 |
| Sector departments of the State Council | Supervise the specified non financial institutions | AML Law art. 15 |
In its official figures for 2024, PBOC branches received more than 11,000 key suspicious leads, ran more than 2,900 AML investigations and passed more than 6,300 leads to investigators and supervisory commissions.
Who must comply with AML rules in China?
The law binds financial institutions and specified non financial institutions set up within the territory of the People's Republic of China (art. 6). Hong Kong and Macao sit outside this guide: the AML Law is not on the list of national laws in Annex III of Hong Kong's Basic Law, so it is not applied there (art. 18).
| Who (in force, November 2026) | Basis | Scope |
|---|---|---|
| Banks, securities, fund, futures, insurance and trust institutions, plus finance, leasing and wealth management companies | AML Law art. 63; CDD Measures art. 2 | Every duty in the obligations table |
| Non bank payment institutions | AML Law art. 63; CDD Measures art. 17 | Every duty, and CDD on the merchants they acquire, as banks do |
| Card and online payment clearing houses, remittance firms, fund distributors, insurance agents and brokers, online microlenders | CDD Measures art. 47; Reporting Measures arts. 2, 25 | The CDD and record rules; large value and suspicious transaction reports (clearing houses: monitoring and reporting under PBOC rules) |
| Real estate developers and agents | AML Law art. 64 | When selling or brokering homes |
| Accountants, lawyers and notaries | AML Law art. 64 | When acting for clients in property deals, managing funds, securities, other assets or accounts, raising funds for a company, or buying and selling a business |
| Dealers in precious metals and stones | AML Law art. 64 | Spot trading above a set amount |
| Any other firm the PBOC designates | AML Law arts. 63, 64 | As designated |
| Every entity and individual | AML Law art. 40 | The list measures |
How does AML risk assessment work in China?
Risk assessment runs at three levels. The PBOC, with other state bodies, assesses national and sector risk and publishes guidance (art. 23). Each institution assesses its own risk regularly (art. 27). Each customer gets a risk grade at onboarding; the highest grade is reviewed at least once a year, and grades move with risk (CDD Measures art. 25). Unusual activity, doubt about earlier data or a requested change of name, ID, owner or legal representative triggers a further check (art. 26).
What are the AML requirements for financial institutions in China?
Art. 6 sets out the key obligations: internal controls, customer due diligence (客户尽职调查), record keeping, large value and suspicious transaction reports (大额交易报告, 可疑交易报告) and special preventive measures (反洗钱特别预防措施). The CDD Measures open with the know your customer (KYC) principle, 了解你的客户 (art. 3). Under the law, customer due diligence means identifying the customer and its beneficial owner (受益所有人), taking reasonable steps to verify them, understanding the purpose of the relationship and the transaction and, where risk is higher, the source and use of funds; lower risk calls for simplified CDD as the case warrants (art. 29). The last column shows what complead, formerly Sanction Scanner, brings to each duty.
| Obligation | Legal basis (in force, November 2026) | What a program must do | How complead does it |
|---|---|---|---|
| Internal controls and risk assessment | AML Law art. 27 | A lead AML unit, staff matched to size and risk, training, a periodic risk assessment with rules to match, internal or external audit; the head of the institution answers for it. | A rule change keeps its version, its author, its time and its reason, and one click rolls it back. |
| CDD triggers | AML Law arts. 28, 29; CDD Measures arts. 7, 8, 30, 31 | CDD at onboarding, for a one off service above the line (single or clearly linked transactions), on suspicion and on doubt about earlier data; no anonymous, false name or borrowed identity accounts. Where CDD cannot be done, no relationship or one off service above the line; exit an existing one where warranted and file an STR. Where CDD on a suspect would tip them off, it may be skipped, but an STR is filed (art. 31). | Every name search is logged: who ran it, at what time, with what outcome, empty results too. |
| One off and sector lines | CDD Measures arts. 9, 11 to 16 | Apply the RMB lines in the next table. | Lines sit in rules built without code, per product, segment or jurisdiction. |
| Beneficial owners | AML Law arts. 19, 29; BO Identification Measures arts. 4, 8 | 25 percent of equity, profit rights or votes, or actual control; failing those, the person who runs daily management. Never taken from the PBOC register alone. | KYB and UBO verification traces each ownership layer to the natural persons at the top, with no fixed depth cap, and marks any layer it cannot resolve as unresolved. |
| Enhanced due diligence | AML Law art. 30; CDD Measures arts. 27, 28 | One or more of: purpose and source of funds evidence, site visits, closer monitoring, deeper owner review, senior approval. Transactions may then be limited; a customer whose risk exceeds what the institution can manage is refused or exited. | A rule scoped to one segment or jurisdiction carries its own conditions, thresholds and score effects. |
| Foreign PEPs | CDD Measures art. 33 | Reasonable steps to learn whether the customer or its owner is a current or former foreign PEP, a relative or a close associate; if so, source and use of funds, senior approval and enhanced ongoing monitoring. For senior managers of international organizations, the same where risk is higher. Domestic PEPs are not named. | A possible PEP match reaches a reviewer with its evidence; the reviewer makes the call, and the case file names that reviewer. |
| Ongoing monitoring and risk grades | AML Law art. 30; CDD Measures arts. 25, 26 | Grade at onboarding, review the top grade at least once a year, recheck on unusual activity, doubt or a change of key data. | Monitoring is switched on or off per name by API trigger. |
| Records | AML Law art. 34; CDD Measures art. 44; Reporting Measures art. 21 | Identity data at least 10 years after the relationship or one off service ends, transaction records at least 10 years after the transaction, longer while an AML investigation is open; reports and analysis records at least 10 years from creation. | Searches with no match stay in the audit trail beside every other check. |
| Large value reports | AML Law art. 35; Reporting Measures arts. 5, 8 | Report the lines in the next table to CAMLMAC within 5 working days, electronically. | Each RMB line can sit in a rule backtested over 30, 60 or 90 days of history. |
| Suspicious transaction reports | AML Law art. 35; Reporting Measures arts. 11, 14, 15 | Any amount; analyze flagged transactions within set time limits; file promptly once confirmed under the internal procedure; keep the filing confidential. | Regulatory compliance work runs on reporting support inside case management, and each alert carries the rule behind it and the signals it matched. |
| Special preventive measures | AML Law arts. 40, 41; Special Preventive Measures arts. 3, 13 to 18 | Screen all customers whenever a list is issued or changed, at onboarding, at a one off service and when identity data change, plus counterparties and all business; stop services and restrict transfers at once, without prior notice; report in writing to the PBOC, and to the Ministry of Public Security and the Ministry of State Security for the terrorist list. | Client screening draws on 3,500+ sanctions, PEP and watchlists from 220+ jurisdictions, refreshed every 15 minutes, UN lists among them. |
| Wire transfers | CDD Measures arts. 34, 35 | Record originator and beneficiary data on outbound cross border transfers and pass the originator's data on, the data the travel rule asks for; verify the originator from RMB 5,000 or USD 1,000, at any amount on suspicion; domestic transfers follow by reference. | Payment screening checks both parties of a transfer through the API during processing. |
| Correspondents and high risk countries | AML Law art. 24; CDD Measures arts. 32, 40 | Board or senior approval for a correspondent relationship, no shell banks; EDD for customers and transactions from high risk countries named by international AML bodies or Chinese authorities. | The connections graph checks a customer's wider network for routes to sanctioned, PEP or adverse media entities, six hops by default, each hop sourced. |
| Third parties, group sharing, foreign requests | AML Law arts. 32, 37, 50 | Rely only on a capable third party that is not higher risk, and keep the CDD liability; share within the group under data protection law and only for AML and CTF; never act alone on a foreign request made outside reciprocity or agreement, and report it to the State Council financial regulator; summary compliance information may follow a report to it and other state bodies (art. 50(2)). | The compliance function and counsel decide; the audit trail shows what was searched. |
Which RMB amounts trigger CDD or a report?
Several lines sit at RMB 50,000 or USD 10,000, and each triggers a different duty. A walk in customer who sends RMB 50,000 in cash through a bank needs CDD first (CDD Measures art. 9), and the same cash remittance goes into a large value report (Reporting Measures art. 5(1)).
| Line (in force, November 2026; amounts at or above the figure) | Amount | Basis |
|---|---|---|
| Bank and remittance one off services: cash remittance, currency exchange, bill cashing, precious metals, product sales | RMB 50,000 or USD 10,000 | CDD Measures art. 9 |
| Securities and fund product sales | RMB 50,000 or USD 10,000 | CDD Measures art. 11 |
| Non investment insurance: premium at signing; claims | RMB 50,000 or USD 10,000 | CDD Measures arts. 12, 14 |
| Insurance surrender, reduction or policy loan | RMB 10,000 or USD 1,000 | CDD Measures art. 13 |
| Anonymous prepaid card sold at once by a payment institution | RMB 10,000 | CDD Measures art. 16 |
| Outbound cross border transfer, verify the originator | RMB 5,000 or USD 1,000; any amount on suspicion | CDD Measures art. 34 |
| Large value cash, single or same day total | RMB 50,000 or USD 10,000 | Reporting Measures art. 5(1) |
| Entity account transfers, single or same day total | RMB 2 million or USD 200,000 | Reporting Measures art. 5(2) |
| Individual domestic transfers, single or same day total | RMB 500,000 or USD 100,000 | Reporting Measures art. 5(3) |
| Individual cross border transfers, single or same day total | RMB 200,000 or USD 10,000 | Reporting Measures art. 5(4) |
| Beneficial owner | 25 percent; 10 percent is one of the measures for higher risk cases | BO Identification Measures arts. 8, 21 |
| Beneficial owner filing exemption | Registered capital up to RMB 10 million, only natural person shareholders or partners, no other control or benefit | BO Information Measures art. 3 |
| Temporary freeze by the PBOC when a customer moves funds under investigation | Up to 48 hours | AML Law art. 45 |
When must a suspicious transaction report reach CAMLMAC?
No day count has applied to suspicious transaction reports since 26 July 2018. The 2016 text allowed at most 5 working days; Order 2018 No. 2, printed in the State Council's official gazette, rewrote art. 15, so the report goes "promptly" (及时) once the institution confirms suspicion under its internal procedure. The "3 business days" in older guides matches neither text. Large value reports keep 5 working days (art. 8). A suspicious transaction report moves through these stages:
| Stage | Input | Output | Who decides | Clock and basis (in force, November 2026) |
|---|---|---|---|---|
| 1. Monitoring | All customers and all business, against the institution's own monitoring standards | Flagged transaction | The institution sets and reviews the standards | Continuous (Reporting Measures arts. 12, 13, 20) |
| 2. Manual analysis | Flagged transaction plus CDD data | Analysis record, with the reason kept when no report is made | Analyst | Reasonable time limit set by the institution (art. 14) |
| 3. Confirmation and filing | Analysis confirmed under the internal procedure | STR to CAMLMAC, electronically | The institution | "Promptly" (art. 15) |
| 4. Serious cases | Obvious crime, a serious threat to national security or social stability, or another serious or urgent case | Copy to the local PBOC branch | The institution | With the STR (art. 17) |
| 5. Records | Reports and analysis records | Kept at least 10 years | The institution | From creation (art. 21) |
How do the beneficial owner rules work in China?
China runs two regimes. Companies, partnerships and foreign company branches file their owners through the registration system under the BO Information Measures, in force 1 November 2024; entities registered earlier had until 1 November 2025 (art. 16), and small firms meeting the art. 3 test may file a commitment instead. The PBOC keeps the data. State bodies may obtain it, and financial institutions may query it for their AML duties and must report any error they find (arts. 12, 13).
Financial institutions also identify the ultimate beneficial owner themselves under Order 2025 No. 12, never from the PBOC's records alone (art. 4). In higher risk cases they apply one or more of eight extra measures, a 10 percent threshold among them (art. 21).
The filing guide of the PBOC's AML Bureau and SAMR (second edition, January 2026, example 4) shows the arithmetic. Jia holds 30 percent of company A, and company B holds 70 percent. B belongs to Yi (30 percent), Bing (20) and company C (50); Bing and Ding each own half of C. Bing holds 14 percent of A through B and 17.5 percent through C, 31.5 percent in all, while Yi holds 21 and Ding 17.5. Jia and Bing are filed.
What are the money laundering risks in China, and how does China align with global FATF standards?
China has been a FATF member since 2007. The FATF, the Eurasian Group (EAG) and the Asia/Pacific Group on Money Laundering (APG) assessed it in 2019, and their report of 17 April 2019 found that China "has a strong understanding of the money laundering and terrorist financing risks it faces, but it should focus more on the laundering of proceeds of crime and increase the range of sources used for its national risk assessment" (FATF).
Ratings are per Recommendation. After follow up reports in 2020, 2021 and 2022, the FATF rerated China: compliant on 9 of the FATF Recommendations, largely compliant on 22, partially compliant on 5 (R.6, R.7, R.12, R.24, R.35) and noncompliant on 4 (R.22, R.23, R.25, R.28), among them DNFBP duties and the transparency of legal arrangements.
China is on neither FATF list, so the FATF does not treat it as a high risk country, and the PBOC's report on the October 2026 plenary names no change for China.
The APG's fifth round schedule lists China for the 2027 plenary, in an assessment led by the IMF, and assesses Hong Kong, China and Macao, China as separate members.
Major money laundering cases
Two recent cases show Chinese money laundering reaching the UK and the US. Qian Zhimin ran an investment fraud in China through Lantian Gerui, with more than 128,000 investors, and, after arriving in the UK in 2017, laundered proceeds already held in bitcoin. Southwark Crown Court sentenced her on 11 November 2025 to 11 years and 8 months.
On 28 August 2025, a FinCEN advisory described Chinese networks that buy Mexico based cartels' dollar proceeds through mirror transactions, a method it ties to Chinese underground banking and the black market peso exchange.
What are the penalties for AML noncompliance in China?
| Article (in force, November 2026) | Breach | Ceiling |
|---|---|---|
| AML Law art. 52 | Internal controls, AML unit, staff, risk assessment, monitoring standards, audit, training, systems, head of institution | Order to correct; more serious: warning or up to RMB 200,000; serious or not corrected in time: RMB 200,000 to 2 million, and business may be limited or barred |
| AML Law art. 53 | CDD, records, large value or suspicious reports | Order to correct, and may warn or fine up to RMB 200,000; serious or not corrected in time: RMB 200,000 to 2 million |
| AML Law art. 54 | Unidentified or anonymous accounts, high risk measures, special preventive measures, confidentiality, obstruction or false material, tampering with records, structuring | Order to correct and up to RMB 500,000; serious: RMB 500,000 to 5 million, and business may be limited or barred |
| AML Law art. 55 | A breach of art. 53 or 54 that let proceeds be hidden through the institution or let terrorist financing occur | Under RMB 10 million involved: RMB 500,000 to 10 million; RMB 10 million or more: 20 percent to twice the amount; serious: business limits or bans, suspension, license revocation |
| AML Law art. 56 | Responsible directors, supervisors, senior managers and other staff | May warn or fine up to RMB 200,000 (arts. 52 to 54) or RMB 200,000 to 1 million (art. 55); serious: disqualification; a person who proves diligence may go unpunished |
| AML Law art. 57 | Acting alone on a foreign request in breach of art. 50 | Up to RMB 500,000; serious: RMB 500,000 to 5 million; where loss is caused, plus 1 to 5 times the direct loss; responsible persons: warning or up to RMB 500,000 |
| AML Law art. 58 | Specified non financial institutions | Order to correct; more serious: warning or up to RMB 50,000; serious or not corrected in time: RMB 50,000 to 500,000; responsible person: warning or up to RMB 50,000 |
| AML Law art. 59 | Other entities and individuals failing the list measures of art. 40 | Order to correct; serious: entity warning or up to RMB 200,000, individual warning or up to RMB 50,000 |
| AML Law art. 60 | Beneficial owner filing missing (registration authority), or false, inaccurate or not updated (PBOC) | Order to correct; refusal: up to RMB 50,000 |
| Criminal Law art. 191 | Money laundering | Proceeds confiscated; up to 5 years or criminal detention, plus or only a fine; serious: 5 to 10 years plus a fine; a company is fined and its responsible managers punished |
The PBOC or one of its branches at city level or above imposes arts. 52 to 56 and 59. Art. 57 sits with the relevant State Council financial regulator, art. 58 with the sector departments.
AML fines imposed by the People's Bank of China in 2025 and 2026
PBOC headquarters posts its decisions on its official site. All nine decisions below cite customer identification or due diligence failures, and seven also cite large value or suspicious reports. Eight still use the pre 2025 term customer identification (客户身份识别); East Money Securities' decision of 22 June 2026 uses the new law's term, customer due diligence. The Bank of Communications, China Construction Bank, Bank of Jiangsu and China Bohai Bank decisions also cover non AML breaches, and their totals are not split.
| Firm | Decided (posted) | Breaches cited | Penalty | Source |
|---|---|---|---|---|
| Bank of Communications | 10 December 2025 (19 December) | 11, including customer identification, records, large value or suspicious reports, anonymous accounts | Warning, RMB 239,821.16 confiscated, RMB 67,834,300 fine | PBOC |
| China Construction Bank | 12 February 2026 (14 February) | 10, including customer identification, records, reports, unidentified customers | Warning, RMB 550,975.67 confiscated, RMB 42,955,100 fine, RMB 43,506,075.67 in total | PBOC |
| ICBC | 3 June 2026 (16 October) | Customer identification | RMB 1,150,000 | PBOC |
| Bank of China | 3 June 2026 (16 October) | Customer identification, unidentified customer | RMB 1,250,000 | PBOC |
| China Everbright Bank | 3 June 2026 (16 October) | Customer identification, large value or suspicious reports | RMB 1,210,000 | PBOC |
| Industrial Bank | 3 June 2026 (16 October) | Customer identification, large value or suspicious reports | RMB 1,060,000 | PBOC |
| East Money Securities | 22 June 2026 (11 September) | Customer due diligence, suspicious reports | Warning, RMB 740,000 | PBOC |
| Bank of Jiangsu | 8 September 2026 (24 September) | 13, including customer identification, reports, anonymous accounts | Warning and public criticism, RMB 1,782.20 confiscated, RMB 9,371,000 fine | PBOC |
| China Bohai Bank | 8 September 2026 (24 September) | 11, including customer identification, reports | Warning, RMB 85,107.25 confiscated, RMB 5,343,700 fine | PBOC |
Which lists must firms screen in China, and how do AML solutions cover them?
The binding lists are Chinese. Art. 40 names three: the terrorist list of the national counterterrorism leading body, Ministry of Foreign Affairs notices carrying out UN Security Council targeted financial sanctions, and lists the PBOC designates, alone or with other state bodies, of parties with major money laundering risk where inaction may have serious consequences. Foreign lists such as OFAC's Chinese Military Companies sanctions are not among them. Art. 50 also bars a financial institution from acting alone on a foreign state's or organization's direct request, made outside reciprocity or agreement, to hand over data or to freeze or move funds.
On complead, client screening and ongoing monitoring takes in UN, OFAC, EU, UK (HMT), DFAT and SECO lists and 200+ national regimes. Payment screening checks sender and receiver while each transfer is processed.
In transaction monitoring, the RMB lines become rule thresholds. Agents close routine cases and attach the work log, the narrative and the evidence to each, so analysts see the cases that need judgment, and the case record names who decided. Order 2025 No. 12 sets that line for owner checks: batch or automated means may not substitute for the institution's risk judgment (art. 4).
Which recent AML developments of 2025 and 2026 matter, and what comes next?
- 1 January 2025. The revised AML Law takes effect.
- 1 November 2025. Beneficial owner filing deadline for entities registered earlier.
- 1 December 2025. Order 2025 No. 10: report and analysis records kept at least 10 years; the 2006 Financial Institutions AML Provisions repealed.
- 1 January 2026. CDD Measures.
- 20 January 2026. BO Identification Measures.
- 16 February 2026. Special Preventive Measures; the 2014 terrorist asset freezing measures repealed.
- 3 June 2026. Four banks fined in decisions of the same day.
- Next. The 2027 plenary evaluation, led by the IMF.
On a China book, three things to check this week:
- CDD on the whole back book is due within two years of 1 January 2026; higher risk customers were due within six months (CDD Measures art. 51).
- Owner checks on existing entity customers run from 20 January 2026: six months for higher risk, two years for all; dormant or strictly limited accounts may wait until the customer asks to reactivate or do business (BO Identification Measures art. 39).
- Rescreen the whole customer base each time a list is issued or changed (Special Preventive Measures art. 13).
The 2026 PDF. The form beside this guide sends a PDF with the working papers this page leaves out: a back book plan for both deadlines, a sheet of list screening triggers, a suspicious transaction stage sheet and a beneficial owner worksheet with the 25 and 10 percent tests.
