In a footage aired last Wednesday, the State broadcaster CCTV accused Bank of China (BOC), one of the Middle Kingdom’s Big Four state-owned banks, of providing a “money laundering” service that helps wealthy mainlanders willing to emigrate move large sums of money overseas.
According to the SCMP:
Under Chinese law, citizens are allowed take only the equivalent of US$50,000 out of the country each year.
CCTV accused the bank of “blatantly offering money laundering services” and fabricating information through its money transfer platform Youhuitong.
It said BOC teamed up with immigration agencies to disguise the origin of clients’ money and helped them send funds overseas for investment immigration.
It also claimed that one BOC branch in Guangdong alone had funnelled six billion yuan (HK$7.5 billion) out of the country this year. It said several BOC branches in Beijing were also found offering similar services.
Analysts are, needless to say, shocked by CCTV’s accusations. Being directly under the authority of the State Council, CCTV needed its approval to launch such a missile against a state-owned enterprise as important as BOC.
BOC, supposedly not the only bank to launder money this way as China Citic Bank (controlled by Citic Group, which is in turn led by the State Council) offers the same foreign exchange service, directly confronted the allegations, saying that CCTV’s undercover reportage was “biased” and failed to grasp the reality. It also explained that the foreign exchange service offered by the two banks was a regional pilot experiment. Approved by the People’s Bank of China, the project is available only in Guangdong province and inserts itself in Beijing’s efforts to control its huge foreign exchange reserves.
But different Citic Bank and BOC branches across the country often referred clients to the Guangdong trial, thus turning it into a nationwide business. Coincidences.
Here are parts of the reportage:
This isn’t the first time BOC has had a brush with the law. The bank was sued by an Israeli law firm in 2012 for “intentionally providing banking services to Hamas through their New York City branch”.
By Aliaume Leroy