Yemen: Terrorist finance bill dead-locked in parliament

The Yemeni parliament is locked in a stand-off over a proposed new law that would crack down on money laundering and terrorist financing by merging the two crimes into one law.

A draft of the bill was introduced by Yemeni government to the parliament saying that the current laws of money laundering and financing terrorism are outdated and full of shortcomings dating back to 2003.

Opposition to the bill in the parliament contend that it would result in stifling charitable businesses and legal resistance by occupied Arab people. Members of parliament did, however, demand application of money laundering reform or amendments of the bill to be applied without merging the terrorism financing issue in the same bill.

“The existing legislation is sufficient,” said Member of Parliament, Sakher al-Wajeeh. “If the current law has deficiencies, it can be amended.”

The majority opposition in parliament says the proposed bill would restrict the work of charities and non-governmental organizations (NGO’s), causing more harm in fighting terrorism.

In Yemen, support of resistances in the Occupied Palestinian Territories are deemed to be legal ad justified actions, however most western states consider it to be terrorism, and the United Nations still cannot agree on a unified definition of terrorism. Al-Wajeeh suspects that the enemies of Islam link the religion with terrorism and claim by fighting Islam, they combat terroristic acts.

“There is no logical link of merging terrorism financing and money laundering because there is no unified definition of terrorism,” said Dr. Salah al-Sanabani, a member of parliament, adding, “the government should define terrorism according to our religion.”

According to the bill’s opposition, supporting this law to combat terrorism harms charitable and self-defense works by Islamic associations, especially resistance and charities in Palestine.

“Money laundering is still a problem in Yemen but has a very limited scope,” said Ahmed Ghalib, the head of the Committee for Combating Money Laundering and Funding Terrorism in Yemen. “Money laundering is possible due to loopholes and weaknesses in the banking system and from regulatory weaknesses. The line becomes blurred as illicit funds are recycled through legitimate business enterprises.”

The new law, according to supporters, aims to supplement the existing law from 2003. The old law did not include the rules of disclosure and dissemination found in the Council Security tracking and lists of terrorism financing crimes. The new law uses the definition terrorism from Arab Convention for Combating Terrorism ratified by the Yemeni Parliament.

By defining terrorism, supporters say that charitable funds can still make their way to causes supported by Yemenis without being accused of supporting it.

According to Ghalib, the new measures will introduce an element of conformity with international principles and standards. The bill was prepared by the Committee for Combating Money Laundering and Terrorism Funding in conjunction with the World Bank and the UN Office of Drugs and Crime, as well as consulting with representatives from the financial community. This was a recommendation by the Financial Action Task Force (FATF) and Arab and international conventions, as well as UN Security Council resolutions.

Mustafa Saif, head of the Money Laundering task force at the Central Bank of Yemen, said that the new draft law limits the amount of money that can be transferred from one bank account to another and international transfers. The law also calls for better monitoring of money transfers through corporations or other authorities. Previous laws did not include these measures.

The bill also says that any person who is found guilty of money laundering or financing terrorism may face imprisonment up to seven years and confiscation of the money to the public treasury.

At the end of the session, the parliament decided to form a committee to offer recommendations in terms of separating or merging financing terrorism with money laundering.

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