China looking at deal with US to recover dirty assets

China looking at deal with US to recover dirty assets
US President Barack Obama (L) and Chinese President Xi Jinping shake hands at the end of their news conference in the Great Hall of the People in Beijing November 12, 2014.

BEIJING - China is looking at signing an agreement with the United States to target assets illegally taken out of China by corrupt officials, a newspaper said on Monday, as the government tightens the screws in its anti-graft battle.

China has vowed to pursue a search, dubbed Operation "Fox Hunt," beyond its borders for corrupt officials and business executives, and their assets.

But Western countries have balked at signing extradition deals with China, partly out of concern about the integrity of its judicial system and treatment of prisoners. Rights groups say Chinese authorities use torture and that the death penalty is common in corruption cases.

The state-run China Daily said the central People's Bank of China was talking to the US Treasury Department's Financial Crimes Enforcement Network about signing an agreement targeting ill-gotten assets held in the United States.

China is set to finalise a similar deal with Canada, Chinese state media reported this month.

The central bank was also looking at a deal with Australia, the China Daily said, citing Zhang Xiaoming, deputy head of the Finance Ministry's legal assistance and foreign affairs department.

"After the agreements are made, China will share intelligence with the US and Australia, which will also offer information to their enforcement agencies to conduct further investigations," Zhang told the English-language paper.

"Once law enforcement officers in the US and Australia identify illegal funds, they will immediately initiate judicial procedures to freeze and confiscate those criminal proceeds in their countries."

The United States, Canada and Australia are popular locations for corrupt officials to transfer their assets, the paper added.

But legal problems have prevented China from getting these assets back, Zhang said.

"Although the US Federal Bureau of Investigation or Australian police have traced the assets and collected enough evidence to identify them as ill-gotten gains, they are unable to take immediate measures to freeze and confiscate them due to the lack of asset restraining orders from the Chinese courts."

President Xi Jinping has vowed to go after high-ranking "tigers" as well as lowly "flies" in his campaign against corruption.

China this month asked the United States to help it track down more than 100 people suspected of corruption. At least 428 Chinese suspects had been captured abroad by early December under the "Fox Hunt" campaign, the China Daily said.

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