Bahrain Central Bank Governor Denies Laundering A Serious Threat

Central Bank of Bahrain (CBB) governor Rasheed Al Maraj said Wednesday that money laundering in Bahrain, which is one of the Gulf's major financial hubs, was not a serious problem problem but that authorities had to remain vigilant.

"There is no reason for concern as we have all the necessary regulations in place and we work very closely with the law enforcement agencies," Al Maraj said at the opening of a two-day training seminar on money laundering in Manama.

"We have not noticed any serious violations, but we have to be vigilant about this," he said. "This is a crime which can originate from distant jurisdictions that is why we need to make sure the system is able to detect these crimes and control them."

Al Maraj said that financial crime was an international phenomenon which required a coordinated international response.

"With relatively low levels of domestically generated criminal proceeds, the greatest risk of money laundering and terrorist financing comes from questionable proceeds that transit Bahrain and the region," he said.

Al Maraj's remarks came amid a warning by a French crime official that efforts to combat money laundering was "not at its best."

Jean-Pierre Bernard of the French Department of Justice, said that France had been "finding it difficult to identify money laundering operations related to drug trafficking because of lack of cooperation from governments in Eastern Europe and some instances the US."

He said that money laundering of drug trafficking from America and South America on one side and from the East on another, topped the concerns of the French authorities.

"International cooperation to combat money laundering however is not at is best despite a strong push to improve intelligence sharing following the September 11th terrorist attacks on New York and Washington," Bernard said.

He also cited cases of money laundering related to the petroleum industry from Iraq, Iran, Nigeria, and Gabon pointing out that the money being laundered was in the billions.

The two-day training seminar is a joint effort carried out by the CBB and the French Embassy in Bahrain focusing on issues relating to detection, investigation and prosecution techniques in the so-called CFT, or combating the financing of terrorism.

Bahrain has some 365 banking and financial institutions operating in it with a consolidated balance sheet of 140.4 billion dollars in 2005, of which 116.2 billion dollars came from offshore banks.

According to Bahrain's Ministry of Interior, the anti-money laundering unit, which was established in 2002, had handled 128 cases in 2006, down from 235 cases the year before.

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