Hong Kong a 'global leader' in financial crime, US lawmakers say

Hong Kong has become a center for financial crimes as Beijing tightened its grip on the city, U.S. lawmakers said, highlighting the worsening ties between the former British colony and Washington.

Since Beijing imposed a national security law on Hong Kong in mid-2020, the city “has shifted from a trusted global financial center to a critical player in the deepening authoritarian axis” of China, Iran, Russia and North Korea, the heads of the House China Select Committee said in a letter to Treasury Secretary Janet Yellen on Monday.

The letter was signed by the committee chairman, Representative John Moolenaar of Michigan, and the panel’s top Democrat, Raja Krishnamoorthi of Illinois. They added that the shift raised questions over “whether longstanding U.S. policy towards Hong Kong, particularly towards its financial and banking sector, is appropriate.”

The relationship between Hong Kong and the U.S. has deteriorated over a crackdown on dissent that American officials say has eroded the rule of law and democratic rights.

In their letter, Moolenaar and Krishnamoorthi said Hong Kong had become a “global leader” in illicit practices such as:

•Giving Russia access to prohibited Western technology

•Forming front companies for buying banned Iranian oil

•Helping with the trade of gold from Russia

•Running ships that conduct illegal trade with North Korea

The letter, which was reported earlier by the Wall Street Journal, also cited research that it said showed that some 40% of goods shipped to Russia from Hong Kong last year were on a “common high priority” list of items that the U.S. and European Union use to focus sanctions enforcement.

Those items included “semiconductors and other technology that Russia most needs for its war in Ukraine,” the letter said.