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Withdrawing cash? Big Brother is watching your every move

HONG KONG — In an effort to stop money laundering and stem capital flows out of China, more than half of the automated teller machines (ATMs) in Macau have been outfitted with facial-recognition technology to monitor cash withdrawals by China nationals.

An automated teller machine in Macau equipped with facial-recognition software. Photo: Bloomberg

An automated teller machine in Macau equipped with facial-recognition software. Photo: Bloomberg

HONG KONG — In an effort to stop money laundering and stem capital flows out of China, more than half of the automated teller machines (ATMs) in Macau have been outfitted with facial-recognition technology to monitor cash withdrawals by China nationals.

Finance chiefs in the world’s largest gambling hub announced that 680 of the 1,300 ATM machines in the city were now equipped with what monetary and banking chiefs described as “Know Your Customer” technology, which they unveiled in May. The technology has been compared to measures depicted in the 2002 futuristic film Minority Report, starring Tom Cruise.

It requires customers to stare into a camera for six seconds to allow the ATM to verify the facial features against those on a customer’s identity card.

A statement from the office of Macau’s Secretary for Economy and Finance, Mr Lionel Leong Vai-tac, said that 680 ATMs were equipped with the new technology and have gone live. Holders of UnionPay bank cards issued by banks in mainland China need to verify their identity through facial recognition before they can collect their money. It added that the verification did not apply to holders of cards issued in Macau and elsewhere.

The new cash dispensers are to monitor millions of bank card users at ATMs across Macau in an unprecedented move by mainland authorities to tackle money laundering and capital flight — the rapid flow of money out of the country in contravention of strict currency controls supporting the yuan. The scanning only applies to holders of China UnionPay cards issued on the mainland.

The move came after The South China Morning Post reported that withdrawals from Macau’s cash-dispensing machines had surpassed HK$10 billion (S$1.77 billion) per month and that special measures would be introduced to ensure ATMs never run out of banknotes.

It also followed a shake-up of the regulatory and enforcement systems of both Hong Kong and Macau to boost the battle against money laundering, financial crime, and the funding of terrorist groups. Since last year, the Chinese authorities have also tightened rules on capital transfers out of China to support the yuan. Some US$816 billion (S$1.128 trillion) were transferred out last year.

Casinos are a favourite method of money laundering as one can withdraw large amounts of cash, buy some chips with a small amount to gamble, and then cash out to move the remainder.

The speedy introduction of the technology in Macau could give rise to a similar move in Hong Kong.

The Hong Kong Monetary Authority has already confirmed it is studying a range of measures to tighten and secure the integrity of the city’s financial institutions as Beijing’s crackdown on money laundering and capital flight presses on.

The new ATMs represent the first widespread consumer application of facial-recognition security programmes in the country, where privacy concerns are not debated as vigorously as in the United States or Europe.

Government censors scrub the Internet of content they deem harmful to the public or to the authority of the Communist Party, and Chinese consumers regularly hand over personal information relating to mobile payment, e-commerce and food-delivery apps.

Mainlanders make up the vast majority of visitors to Macau. Out of a total of 30 million visitors last year, 20 million were from the mainland — mainly from neighbouring Guangdong province. SOUTH CHINA MORNING POST

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