Following RMB convertibility on current account and formulation of the inter-bank market, most payments and earnings in foreign exchange on current account can be transacted directly in the designated banks with licences. Transactions on capital account should also be made after checking and/or approval in those banks with licences. In order to avoid the mixing of transactions on capital account with those on current account and to prevent fraudulent foreign exchange purchases, the licensed banks must inspect all approval certificates according to relevant regulations when processing sales and payments in foreign exchange. Since 1994, as relevant managerial regulations and measures were formulated, supervision on compliance with foreign exchange regulations has been strengthened when financial institutions deal in foreign exchange operations and punishment of wrongdoings has been reinforced.