Core Viewpoint - The implementation of the "Management Measures for Anti-Money Laundering and Anti-Terrorist Financing in the Precious Metals and Gemstone Industry" by the People's Bank of China signifies an enhancement in the regulatory framework for anti-money laundering (AML) within the precious metals and gemstones sector, addressing potential vulnerabilities previously exploited by criminals [1][4][10]. Regulatory Framework - The new management measures expand the scope of AML obligations to include the entire precious metals and gemstones industry, defining the entities subject to these regulations as those legally engaged in the spot trading of precious metals and gemstones within China [1][4]. - The threshold for reporting large transactions has been raised from 50,000 RMB to 100,000 RMB, requiring institutions to report cash transactions at or above this amount within five working days [4][5]. Risk Mitigation - The precious metals and gemstones sector is identified as a high-risk area for money laundering and terrorist financing due to the high value, liquidity, and relative anonymity of transactions [5][10]. - Institutions are mandated to conduct customer due diligence for cash transactions equal to or exceeding 100,000 RMB, which serves as a critical checkpoint to identify potential risks [5][6]. Compliance and Accountability - The management measures require institutions to maintain customer identity information for at least ten years, extending the previous five-year requirement, thereby enhancing record-keeping practices [6]. - Institutions are held accountable for their AML responsibilities, with legal repercussions for negligence or failure to comply, including criminal liability for serious offenses [6][7]. Collaborative Oversight - The measures advocate for a collaborative regulatory framework involving self-regulation within the industry, encouraging information sharing among trading venues and industry organizations under the guidance of the People's Bank of China [7]. - Internal training programs are emphasized to improve employees' understanding and execution of AML regulations, fostering a culture of compliance within the industry [7][10]. Industry Preparedness - The management measures are set to take effect on August 1, 2023, and are expected to elevate the compliance standards within the precious metals and gemstones industry, necessitating proactive measures from institutions to align with the new regulations [10].