The Main Legal Risks Of Private Banking Business In China And The Prevention Mechanism

Overseas private banking service has undergone an evolution of several hundred years. As an important and high-return component in the realm of financial services, private banking has witnessed a rapid development in China. Based on international experience, there are a number of legal risks in private banking business. Domestic private banking business is still in its infancy, in order to develop this business better and faster, to strengthen the research of the legal risks of private banking business at this stage is of great practical significance.This paper begins with the definition, characteristics and legal relationship, clear the differences between private banking business and personal financial services, followed by an overview of the development of private banking business in developed countries and China. In chapter two, this paper introduced the concept of the legal risks of private banking business, then focus on analysis of the main legal risks of current domestic private banking business- regulatory risks; compliance risks in the separate operation mode; lack of risk disclosure; money laundering crime as well as the information leaks of customers, analyze the causes of legal risks of private banking business in China. In chapter three, this paper use the mature legal system of private banking business in developed countries for reference, including the legislation, supervision system, risk management system, anti-money laundering system, confidentiality system, credit system and so on. In chapter four, this paper put forward some suggestions to prevent and resolve the relevant legal risks which about the external institutional environment and internal control mechanisms of legal risks of commercial banks.