Hong Kong’s finance chief has stressed that jurisdictions should deepen cross-border and inter-agency collaboration, strengthen information and intelligence exchange, and expedite the interception and freezing of illicit funds to strengthen international efforts to combat terrorist financing.
In addition, they should make full use of frontier technologies, such as applying blockchain analytics to cross-border tracing, to enhance law enforcement capabilities and the recovery of illicit assets, Paul Chan Mo-po said while delivering a speech at the "No Money for Terror" Ministerial Conference on Counter-Terrorism Financing in Paris, France on Tuesday.
The means of terrorist financing have become increasingly sophisticated, including making use of the anonymity and speed of digital assets to transfer funds across borders and evade tracking, he pointed out.
He stressed the need for jurisdictions to implement relevant international standards, including putting in place appropriate regulation of digital asset platforms and issuers, so as to prevent regulatory arbitrage.
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Pointing out that Hong Kong, China has all along firmly supported and implemented international requirements on anti-money laundering and counter-terrorist financing, the financial secretary said the city has been taking forward relevant work through a comprehensive legal framework, risk-based regulation, and full inter-agency collaboration.
The special administrative region has been assessed as overall compliant in the latest round of mutual evaluation by the Financial Action Task Force, he added.
On digital asset regulation, he said the city has implemented licensing regimes for digital asset platforms and stablecoin issuers, which include requirements on investor protection and prevention of money laundering.
Chan engaged in in-depth exchanges with delegations from over 80 countries and regions on issues including strengthening global cooperation in combating terrorist financing, the government said in a statement.
During a visit to the Organisation for Economic Co-operation and Development (OECD), Chan briefed Deputy Secretary-General Fabrizia Lapecorella on Hong Kong's economic and financial developments and said that Hong Kong, China has been actively participating in the work of committees under the OECD.
The financial secretary also met President of the Financial Action Task Force Elisa de Anda Madrazo and exchanged views on strengthening international cooperation on anti-money laundering and counter-terrorist financing.
During a luncheon with local banking and financial leaders, he briefed them on the latest developments of Hong Kong as an international financial center, as well as the overall direction and opportunities of the city’s economic development.
Chan arrived in Paris on Monday to begin his visit to Europe and was set to depart for Brussels, Belgium on Wednesday.
