Dirty money: banks urged to report suspicious transactions

The police, while investigating cybercrime cases, have discovered that payment portals of some units of the banking system serve as a channel for criminals to remit money.

The money is remitted in cases related to gambling, for-profit online games, and illegal trade of goods and services.

Lawyer Truong Thanh Duc said it is difficult to prevent illegal money remittances and payments. Banks cannot intervene when party A remits money to party B if the parties have stated they are making payments for legal goods or services.

“Banks don’t know the real reasons behind customers’ money remittance behavior, so they could lose customers if they ask,” he explained.

However, Duc said that banks must accept their responsibility in the fight against cybercrimes and cooperate with the police.

“Banks should notify police about transactions worth hundreds of billions or trillions of dong, like in the newly discovered online gambling case led by Phan Sao Nam,” Duc said.

Nam, former chairman of VTC Online Telecommunications, was the ringleader of an online gambling ring along with 70 others. The case had the alleged involvement of Nguyen Thanh Hoa, former head of the High-tech Crime Police Department.

Duc said that banks need to look for abnormalities in transactions. If client A doesn’t register a business that needs big cash flow, but receives large amounts of money from other inpiduals and institutions, this must be investigated and reported.

If client A is a dumpling seller and has a regular income of VND10 million a day, but one day receives money 20 times higher than his normal pay, the banks need to question the ‘irregular cash flow’.

Vietnam has a comprehensive legal framework to fight against cybercrime and money laundering. The problem is strengthening enforcement.

An analyst commented that in many cases banks ignore dubious transactions because they want to retain clients.

A high-ranking official of the State Bank, affirming that the watchdog agency has vowed to settle the problem, said it plans to amend provisions in Decree 101 on non-cash payments, and in Circular 39 on intermediary payment service.

The new legal documents will set detailed regulations on the responsibilities of intermediary payment organizations and credit institutions in checking clients and partners that provide IT services.

Meanwhile, Nguyen Dang Hung, deputy CEO of NAPAS (the National Payment Corporation of Vietnam), has urged the use of ACH, an electronic clearing system for retail transactions.