Money laundering has been a reoccurring issue in China, with the infamous case of Gong Aiai, who purchased more than 20 Beijing prosperities with fake ID’s in 2013 and with China’s increasing real estate market, the Chinese government is prepared to take new steps in order to prevent illegal money from trickling into the market. In a joint statement made in September by the People’s Bank of China, the China Banking Regulatory Commission and the Ministry of Housing and Urban-Rural Development, they stated that they plan on increasing anti-money laundering (AML) measures in real estate. One of the ways they plan to accomplish this is by asking prospective buyers about their intentions for buying the property and their means of paying. This extended due diligence will also include requiring home buyers to use personal bank cards and accounts to make property purchases, and later refunding them directly if they change their minds.
To further assist with China’s AML efforts, developers and agents have also been asked to report all payments made in cash to China’s Anti-Money Laundering Monitoring and Analysis Center no more than 5 days after the payment has been made.
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