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Mon, Sep 19, 2005 - Page 12 News List

Macau intervenes after bank run over US report

AFP , HONG KONG

A Macau bank accused by the US of aiding illicit North Korean activities is under government control amid fears the scandal could wreck the city's financial sector, officials said yesterday.

Two administrators have been put in charge of Banco Delta Asia after US Treasury Department allegations that it was involved in passing counterfeit currency and money laundering for North Koreans sparked a run on the bank.

The southern Chinese territory's monetary authority said in a statement that the appointments had been made "for the purpose of safeguarding the financial stability in Macau, ensuring regular operations and consolidating public confidence on the financial system."

More than 300 million patacas (US$38 million) were withdrawn from Banco Delta Asia ATMs over the weekend over worries that the censure could close the bank.

The sudden flurry of withdrawals prompted a call for caution from the former Portuguese enclave's political leader Edmund Ho (何厚鏵), and the monetary authority urged customers not to panic lest it undermined confidence in the city's banks.

In the US report, the bank was designated a "primary money laundering concern," alerting the global community to the "illicit financial threat" it posed.

Bank chairman Stanley Au (區宗傑) said it had severed business with North Korean clients in a bid "to resolve the dispute with the United States Department of Treasury," Xinhua reported.

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