BEIJING, Jan 17 (Reuters) - China's central bank told financial institutions on Friday that they had an obligation to report transactions and accounts suspected of links to terror activities, as Beijing steps up a campaign to clamp down on suspected militants in the far west.
China says it faces a threat from extremist Islamist groups in the restive Xinjiang region who have links abroad, though rights groups say the country overplays the risk to justify its harsh control of the strategically vital area.
At least 91 people, several police officers among them, have been killed in violence in Xinjiang since last April, state media have reported.
China has stepped up security in Xinjiang after a car ploughed into tourists on the edge of Beijing's Tiananmen Square in October, killing three people occupants and two bystanders. China blamed the attack on Islamist militants.
China in 2006 ratified an international convention to fight financing of terrorism, and the latest move adds to the legal arsenal China may use to fight the terror threat it says it faces.
Rules unveiled on the website of the central People's Bank of China say all financial institutions must report to the central bank if they have "reasonable suspicion" that customers or transactions have anything to do with terror activities.
The assets of people named on government lists as belonging to terror groups, or being involved in terror activities must also be frozen, and a close watch be keep on all transactions, the central bank added.
It said the rules had been released to "standardise the process and action of freezing assets related to suspected terror activities and protect state security and the interests of society".
Financial institutions are also forbidden to tip off any customers that their accounts or assets are about to be frozen and must maintain strict secrecy, the central bank said.
Officials who fail to cooperate or leak information leading to the illicit transfer or concealment of frozen assets will also be punished, the central bank added.
Chinese financial institutions cannot hand over account details or freeze accounts requested by foreign governments without proper diplomatic or legal formalities being followed, and if Chinese bank's overseas branches are asked to freeze assets they have to report to headquarters back home, it said.
The statement made no mention of Xinjiang or Islamist militants, but the government has not said it faces a major domestic terror threat from anyone else.
Xinjiang is home to the Muslim Uighur people who speak a Turkic language. Many resent what they see as oppressive treatment by the government, although Beijing says they are granted wide religious, cultural and linguistic freedom. (Reporting by Ben Blanchard; Editing by Clarence Fernandez)