On November 17, 2025, the SFC issued a circular urging licensed firms to detect and prevent potential layering activities in money laundering. They highlight the increasing trend of bad actors exploiting these firms for money laundering, often by obscuring illicit funds' source and destination. The SFC emphasizes the need for robust AML/CFT controls and has stepped up public-private sector cooperation, including the facilitation of a 24/7 stop payment mechanism to intercept crime proceeds. A webinar was held today to provide updates to licensed firms on AML/CFT standards and regulatory responses.
This article was generated using SAMS, an AI technology by Timothy Loh LLP.
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On November 17, 2025, the Securities and Futures Commission ("SFC") issued a circular to licensed firms and virtual asset trading platforms, urging them to maintain vigilance against layering activities, a common tactic employed in money laundering. The SFC warned that bad actors use these platforms to obscure the source and destination of illicit funds through frequent and structured deposits and immediate withdrawals.
The SFC reaffirmed its expectations for stringent compliance with robust AML/CFT standards among licensed firms. It underscored the collaborative efforts with the Hong Kong Police Force, including the Anti-Deception Coordination Centre ("ADCC") and the Joint Financial Intelligence Unit, to enhance public-private sector cooperation. Notably, since September 2025, a third of known deception and scam-related crime proceeds have been intercepted successfully through a 24/7 stop payment mechanism facilitated by these firms.
In support of compliance, the SFC organized a webinar for licensed firms, updating them on supervisory observations and regulatory responses within Hong Kong's securities and virtual assets markets. Dr. Eric Yip, the SFC's Executive Director of Intermediaries, stressed the importance of safeguarding operational integrity and advised firms to remain vigilant for red flags of suspicious transactions. The SFC will continue to monitor compliance and enforce regulations against firms that fail to meet their obligations.
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