A deal for the payment affiliate of Chinese e-commerce giant Alibaba Group Holding Ltd to buy U.S. money-transfer company MoneyGram International Inc has the potential not only to rattle the international funds transfer landscape, but also to pressure China to bolster a lackluster anti-money laundering regime, anti-money laundering professionals said.
But foreign branches of Chinese banks have been hit hard with regulatory enforcement actions around the world over alleged failures to properly police transactions for criminal activity, and banks in China are considered better regulated than other payment platforms operating in the country, raising questions about how U.S. regulators will view Chinese control of America’s number-two money transfer firm, the experts said.