CHINA TRIES TO COVER UP NEWS OF ITS CORRUPT PEPS BY KIDNAPPING HONG KONG PUBLISHERS

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corrupt Chinese PEPs is important to compliance officers, but it also sells big in Hong Kong, where mainland censorship does not exist. China's kidnapping of five publishing house executives, from companies that regularly publish details of Chinese corruption at the highest level, reinforces the fact that China simply does not want you to know about the extent of corruption, among its power elite, many of whom have socked away millions obtained illegally, all in overseas accounts and investments.

One of those kidnapped was a UK citizen, taken in Hong Kong, which is a serious breach of the British-Chinese agreement on the former Crown colony. Another, a Swedish citizen, was kidnapped in Thailand. No wonder the public in Hong Kong is angry and frightened.

If China can go to such lengths, to intimidate individuals who publish the truth about its leaders, then all EU and North American compliance officers should adopt the position that ALL affluent Chinese nationals seeking to open accounts, or business relationships require Enhanced Due Diligence investigations, because the truth of their PEP status could be well hidden, and not reported in the media.

I would now consider that there is a rebuttable presumption that your new wealthy Chinese client is a PEP, until you eliminate him as such. This may sound overbearing, but since China is going to such lengths to be opaque about its leaders, one must assume the worst, until you rule it out.