Lawyers for two mosque leaders convicted on money laundering charges in a fake missile plot argued that the government unfairly entrapped their clients, but a prosecutor said the men knew what they were doing when they committed their crimes.
A three-judge panel of the 2nd U.S. Circuit Court of Appeals listened to arguments Monday on behalf of Yassin Aref, imam at an Albany mosque, and Mohammed Hossain, a pizzeria owner who attended the mosque, but did not immediately rule.
The mosque was raided by the FBI in August 2004 after a yearlong investigation.
The men were convicted of laundering money through fake loans from 2003 to 2004 for a Pakistani businessman and FBI informant posing as an arms dealer. Each was sentenced last year to 15 years in prison.
Lawyers for both men said the government unfairly targeted their clients in a rush to build terrorism cases after the Sept. 11, 2001, attacks.
Aref's lawyer, Terence Kindlon, said his client became a target of the U.S. government when a word before his name on a slip of paper in an Iraqi training camp for militants was thought to mean "commander" when it actually was an innocuous term equivalent to "Mr."
He said the FBI relied on an informant who delivered an "improbable story badly told."
Hossain's lawyer, Kevin Luibrand, said his client never tried to hide the money because he was not laundering it.
Assistant U.S. Attorney William Pericek said the sting was successful because Hossain was motivated by greed and Aref was motivated by sympathy for those willing to carry out terrorist acts.
He said Aref knew the plot involved plans to use a shoulder-fired missile in New York City. The plot was a fictional part of the sting operation.
http://www.iht.com/articles/ap/2008/03/24/america/NA-GEN-US-Mosque-Raid.php
Showing posts with label Albania. Show all posts
Showing posts with label Albania. Show all posts
on Sunday, May 13, 2012
June 13, 2008
HP-1023
Washington - The U.S. Department of the Treasury today designated the Kuwait-based Revival of Islamic Heritage Society (RIHS) for providing financial and material support to al Qaida and al Qaida affiliates, including Lashkar e-Tayyiba, Jemaah Islamiyah, and Al-Itihaad al-Islamiya. RIHS has also provided financial support for acts of terrorism.
"Designating and freezing the assets of an organization engaged in charitable work is a decision not taken lightly because the last thing we want to do is cut off needed humanitarian assistance," said Stuart Levey, Under Secretary for Terrorism and Financial Intelligence. "However, the reality is that RIHS has used charity and humanitarian assistance as cover to fund terrorist activity and harm innocent civilians, often in poor and impoverished regions. We have a responsibility to do all we can to shut down the funding channels of terrorism."
RIHS was designated today under Executive Order 13224, which targets terrorists and those providing financial, technological, or material support to terrorists or acts of terrorism. Any assets RIHS holds under U.S. jurisdiction are frozen and U.S. persons are prohibited from engaging in any transactions with RIHS.
The RIHS offices in Afghanistan (RIHS-Afghanistan) and Pakistan (RIHS-Pakistan) were designated by the U.S. Government and the United Nations 1267 Committee in January 2002 based on evidence of their support for al Qaida. At that time, there was no evidence that the Kuwait-based RIHS headquarters (RIHS-HQ) knew that RIHS-Afghanistan and RIHS-Pakistan were financing al Qaida.
Since that time, however, evidence has mounted implicating RIHS-HQ in terrorism support activity. The U.S. Government has learned that RIHS senior leadership, who have actively managed all aspects of the organization's day-to-day operations, have been aware of both legitimate and illegitimate uses of RIHS funds.
"We designated two branches of RIHS in 2002, and since then a number of other countries have taken action against RIHS. We look forward to continuing our work with Kuwaiti authorities to ensure that legitimate charitable giving can reach those in need and not be diverted to terrorist organizations," Levey continued.
Suspected of providing support to terrorism, RIHS offices have been closed or raided by the governments of Albania, Azerbaijan, Bangladesh, Bosnia-Herzegovina, Cambodia, and Russia.
In countries where RIHS activities are banned or scrutinized by local governments, RIHS-HQ has developed multiple methods to continue its operations. After the Government of Bangladesh closed RIHS offices, RIHS-HQ funneled money into Bangladesh through another organization to continue RIHS activities and to help shield it from scrutiny there. RIHS-HQ has used RIHS officials and other individuals to courier funds out of the country in order to evade the scrutiny of the international financial system. In some countries, including Albania and Kosovo in particular, RIHS senior officials have assisted RIHS branch offices with name changes, and then continued to provide financial support to the new organizations.
RIHS Support for Terrorism in South Asia
RIHS-HQ provides significant financial and logistical support to the U.N.-designated terrorist group Lashkar e-Tayyiba (LeT), a Pakistan-based terrorist group with links to the al Qaida network. LeT was reportedly implicated in the July 2006 attack on multiple Mumbai commuter trains, and in the December 2001 attack against the Indian Parliament. As of 2007, RIHS provided office space to an LeT leader who visited Kuwait to raise funds for LeT operations. RIHS officials accompanied the LeT leader while he raised funds throughout Kuwait. As of late 2007, RIHS sent money to LeT elements on a monthly basis, and regularly transferred funds to LeT representatives' bank accounts in Pakistan. In some cases, LeT has received the funds at charitable entities associated with RIHS.
RIHS also reportedly provided a key source of funding for terrorist attacks carried out by an extremist group in Bangladesh in 2005. Despite a February 2005 Bangladeshi government ban of the terrorist group Jamaaat Mujahidin Bangladesh (JMB), on August 17, 2005, JMB launched a series of near-simultaneous bomb attacks across Bangladesh, killing two and injuring 64 persons. Over 400 bombs exploded during the course of these attacks, which were carried out in 63 of Bangladesh's 64 provinces. Following the bombings, RIHS was identified as one of the key sources of funding needed for staging these attacks. After the August 2005 bombings, RIHS was accused of funding JMB's military activities with overt and covert funds. These funds were channeled through a senior leader of a Bangladeshi Islamic organization. As of early 2005, RIHS in Bangladesh had contributed millions of dollars to this organization.
RIHS Support for Terrorism in Southeast Asia and the Horn of Africa
RIHS has provided financial and logistical support to the Southeast Asia based terrorist group Jemaah Islamiyah (JI). Specifically, an RIHS employee provided logistical support to JI's fugitive leader Nurjaman Riduan Isamuddin (a.k.a. "Hambali") prior to his capture in 2003. Due to the high security conditions during the 2002 Asian Summit, the RIHS employee escorted Hambali from Phnom Penh, Cambodia, to an alternate location, where he then provided him with accommodations. The employee was later captured and sentenced to life imprisonment on terrorism charges. An RIHS representative in Indonesia provided funding to a JI member collecting money for JI activities. The JI member funneled the funds he received from RIHS and other sources to JI associates for the procurement of weapons to support their operations.
RIHS has also funded al Qaida and like-minded terrorist groups in Somalia. Al Qaida supporters in Somalia reportedly have historically received significant funds through RIHS. In addition, RIHS provided hundreds of thousands of dollars to a university controlled by Al-Itihaad al-Islamiya.
IDENTIFIER INFORMATION
Revival of Islamic Heritage Society
RIHS Headquarters-Kuwait
Revival of Islamic Heritage Foundation
RIHF
Society for the Revival of Islamic Heritage
Islamic Heritage Revival Party
Islamic Heritage Restoration Society
IHRS
Kuwaiti Heritage
Ihya Turas Al-Islami
Ijha Turath Al-Islami
Jamia Ihya Ul Turath
Jamiat Ihia Al-Turath Al-Islamiya
Jam'iyat Ihya' Al-Turath Al-Islami
Jami'at Ihy'a Al-Tirath Al-Islamia
Jamiatul Ihya Ul Turath
Jamiyat Ikhya At-Turaz Al-Islami, Society of the Rebirth of the Islamic People
Jamiatul-Yahya Ut Turaz
Jomiatul Ehya-Ut Turaj
Jomiyatu-Ehya-Ut Turas Al Islami
Jama'ah Ihya Al-Turaz Al-Islami
Jami'ah Al-Hiya Al-Turath Al Islamiyah
Lajnat Ihya Al-Turath Al-Islami
Lajnat Al-Ihya Al-Turath Al-Islami
RIHS Administration for the Building of Mosques and Islamic Projects
RIHS Mosques Committee
Administration of the Revival of Islamic Heritage Society Committee
RIHS Arab World Committee
RIHS Committee for the Arab World
RIHS Committee for West Asia
RIHS Central Asia Committee
Committee for Europe and the Americas
RIHS Europe and the Americas Committee
RIHS Two Americas and European Muslim Committee
RIHS Europe America Muslims Committee
RIHS Southeast Asia Committee
RIHS Committee for South East Asia
RIHS Indian Continent Committee
RIHS Indian Subcontinent Committee
RIHS Committee for India
RIHS African Continent Committee
RIHS Committee for Africa
Revival of Islamic Society Heritage on the African Continent
RIHS Public Relations Committee
RIHS Cultural Committee
RIHS Principle Committee for the Center for Preservation of the Holy Qu'aran
RIHS General Committee for Donations
RIHS Youth Center Committee
RIHS Scientific Committee-Branch of Sabah Al-Nasir
RIHS Fatwas Committee
RIHS Center for Manuscripts Committee
RIHS Educating Committees, Al-Jahra'
RIHS Audio Recordings Committee
RIHS Project of Assigning Preachers Committee
RIHS Office of Printing and Publishing
RIHS Committee for Women
RIHS Committee for Women, Administration for the Building of Mosques
RIHS Women's Branch for the Project of Endowment
RIHS Administration for the Committees of Almsgiving
RIHS Committee for Almsgiving and Charities
RIHS Committee for the Call and Guidance
RIHS-Cambodia
RIHS Cambodia-Kuwait Orphanage Center
The Kuwaiti-Cambodian Orphanage Center
The Kuwait-Cambodia Islamic Cultural Training Center
RIHS Chaom Chau Center
Nara Welfare and Education Association
RIHS-Bosnia and Herzegovina
Kuwaiti Joint Relief Committee, Bosnia and Herzegovina
KJRC-Bosnia and Herzegovina
Plandiste School, Bosnia and Herzegovina
Organizacija Preporoda Islamske Tradicije Kuvajt
Kuwait General Committee for Aid
General Kuwait Committee
RIHS-Albania
Center of Call for Wisdom
CCFW
Thirrja Per Utesi
NGO Turath
RIHS-Kosovo
Dora E Miresise
Hand of Mercy
RIHS-Azerbaijan
RIHS-Russia
RIHS-Lebanon
RIHS-Bangladesh
RIHS-Somalia
RIHS-Ghana
RIHS-Tanzania
RIHS-Benin
RIHS-Cameroon
RIHS-Senegal
RIHS-Nigeria
RIHS-Liberia
RIHS-Ivory Coast
Addresses: Part 5, Qurtaba, P.O. Box 5585, Safat, Kuwait
House #40, Lake Drive Road, Sector #7, Uttara, Dhaka, Bangladesh
Number 28 Mula Mustafe Baseskije Street, Sarajevo, Bosnia and Herzegovina
Number 2 Plandiste Street, Sarajevo, Bosnia and Herzegovina
M.M. Baseskije Street, No.28p, Sarajevo, Bosnia and Herzegovina
Number 6 Donji Hotonj Street, Sarajevo, Bosnia and Herzegovina
RIHS Office, Ilidza, Bosnia and Herzegovina
RIHS Alija House, Ilidza, Bosnia and Herzegovina
RIHS Office, Tirana, Albania
RIHS Office, Pristina, Kosovo
Tripoli, Lebanon
City of Sidon, Lebanon
Dangkor District, Phnom Penh, Cambodia
Kismayo, Somalia
Kaneshi Quarter of Accra, Ghana
Al-Andalus, Kuwait
Al-Jahra', Kuwait
Al-Qurayn, Kuwait
Sabah Al-Nasir, Kuwait
Qurtubah, Kuwait
Hadiyah, Kuwait
Al-Qadisiyah, Kuwait
Al-Fayha', Kuwait
Al-Riqah, Kuwait
Al-Firdaws, Kuwait
Khitan, Kuwait
Al-Sabahiyah, Kuwait
Jalib Al-Shiyukh, Kuwait
Bayan Wa Mashrif, Kuwait
Sabah Al-Salim, Kuwait
Al-Rumaythiyah, Kuwait
Al-Salimiyah, Kuwait
Al-Aridiyah, Kuwait
Al-Khalidiya, Kuwait
Al-Dhahr, Kuwait
Al-Rawdah, Kuwait
Al-Shamiyah Wa Al-Shuwaykh, Kuwait
Al-Amiriyah, Kuwait
Al-Nuzhah, Kuwait
Kifan, Kuwait
Website: www.alturath.org
Source: US Department of Treasury Press Room
HP-1023
Washington - The U.S. Department of the Treasury today designated the Kuwait-based Revival of Islamic Heritage Society (RIHS) for providing financial and material support to al Qaida and al Qaida affiliates, including Lashkar e-Tayyiba, Jemaah Islamiyah, and Al-Itihaad al-Islamiya. RIHS has also provided financial support for acts of terrorism.
"Designating and freezing the assets of an organization engaged in charitable work is a decision not taken lightly because the last thing we want to do is cut off needed humanitarian assistance," said Stuart Levey, Under Secretary for Terrorism and Financial Intelligence. "However, the reality is that RIHS has used charity and humanitarian assistance as cover to fund terrorist activity and harm innocent civilians, often in poor and impoverished regions. We have a responsibility to do all we can to shut down the funding channels of terrorism."
RIHS was designated today under Executive Order 13224, which targets terrorists and those providing financial, technological, or material support to terrorists or acts of terrorism. Any assets RIHS holds under U.S. jurisdiction are frozen and U.S. persons are prohibited from engaging in any transactions with RIHS.
The RIHS offices in Afghanistan (RIHS-Afghanistan) and Pakistan (RIHS-Pakistan) were designated by the U.S. Government and the United Nations 1267 Committee in January 2002 based on evidence of their support for al Qaida. At that time, there was no evidence that the Kuwait-based RIHS headquarters (RIHS-HQ) knew that RIHS-Afghanistan and RIHS-Pakistan were financing al Qaida.
Since that time, however, evidence has mounted implicating RIHS-HQ in terrorism support activity. The U.S. Government has learned that RIHS senior leadership, who have actively managed all aspects of the organization's day-to-day operations, have been aware of both legitimate and illegitimate uses of RIHS funds.
"We designated two branches of RIHS in 2002, and since then a number of other countries have taken action against RIHS. We look forward to continuing our work with Kuwaiti authorities to ensure that legitimate charitable giving can reach those in need and not be diverted to terrorist organizations," Levey continued.
Suspected of providing support to terrorism, RIHS offices have been closed or raided by the governments of Albania, Azerbaijan, Bangladesh, Bosnia-Herzegovina, Cambodia, and Russia.
In countries where RIHS activities are banned or scrutinized by local governments, RIHS-HQ has developed multiple methods to continue its operations. After the Government of Bangladesh closed RIHS offices, RIHS-HQ funneled money into Bangladesh through another organization to continue RIHS activities and to help shield it from scrutiny there. RIHS-HQ has used RIHS officials and other individuals to courier funds out of the country in order to evade the scrutiny of the international financial system. In some countries, including Albania and Kosovo in particular, RIHS senior officials have assisted RIHS branch offices with name changes, and then continued to provide financial support to the new organizations.
RIHS Support for Terrorism in South Asia
RIHS-HQ provides significant financial and logistical support to the U.N.-designated terrorist group Lashkar e-Tayyiba (LeT), a Pakistan-based terrorist group with links to the al Qaida network. LeT was reportedly implicated in the July 2006 attack on multiple Mumbai commuter trains, and in the December 2001 attack against the Indian Parliament. As of 2007, RIHS provided office space to an LeT leader who visited Kuwait to raise funds for LeT operations. RIHS officials accompanied the LeT leader while he raised funds throughout Kuwait. As of late 2007, RIHS sent money to LeT elements on a monthly basis, and regularly transferred funds to LeT representatives' bank accounts in Pakistan. In some cases, LeT has received the funds at charitable entities associated with RIHS.
RIHS also reportedly provided a key source of funding for terrorist attacks carried out by an extremist group in Bangladesh in 2005. Despite a February 2005 Bangladeshi government ban of the terrorist group Jamaaat Mujahidin Bangladesh (JMB), on August 17, 2005, JMB launched a series of near-simultaneous bomb attacks across Bangladesh, killing two and injuring 64 persons. Over 400 bombs exploded during the course of these attacks, which were carried out in 63 of Bangladesh's 64 provinces. Following the bombings, RIHS was identified as one of the key sources of funding needed for staging these attacks. After the August 2005 bombings, RIHS was accused of funding JMB's military activities with overt and covert funds. These funds were channeled through a senior leader of a Bangladeshi Islamic organization. As of early 2005, RIHS in Bangladesh had contributed millions of dollars to this organization.
RIHS Support for Terrorism in Southeast Asia and the Horn of Africa
RIHS has provided financial and logistical support to the Southeast Asia based terrorist group Jemaah Islamiyah (JI). Specifically, an RIHS employee provided logistical support to JI's fugitive leader Nurjaman Riduan Isamuddin (a.k.a. "Hambali") prior to his capture in 2003. Due to the high security conditions during the 2002 Asian Summit, the RIHS employee escorted Hambali from Phnom Penh, Cambodia, to an alternate location, where he then provided him with accommodations. The employee was later captured and sentenced to life imprisonment on terrorism charges. An RIHS representative in Indonesia provided funding to a JI member collecting money for JI activities. The JI member funneled the funds he received from RIHS and other sources to JI associates for the procurement of weapons to support their operations.
RIHS has also funded al Qaida and like-minded terrorist groups in Somalia. Al Qaida supporters in Somalia reportedly have historically received significant funds through RIHS. In addition, RIHS provided hundreds of thousands of dollars to a university controlled by Al-Itihaad al-Islamiya.
IDENTIFIER INFORMATION
Revival of Islamic Heritage Society
RIHS Headquarters-Kuwait
Revival of Islamic Heritage Foundation
RIHF
Society for the Revival of Islamic Heritage
Islamic Heritage Revival Party
Islamic Heritage Restoration Society
IHRS
Kuwaiti Heritage
Ihya Turas Al-Islami
Ijha Turath Al-Islami
Jamia Ihya Ul Turath
Jamiat Ihia Al-Turath Al-Islamiya
Jam'iyat Ihya' Al-Turath Al-Islami
Jami'at Ihy'a Al-Tirath Al-Islamia
Jamiatul Ihya Ul Turath
Jamiyat Ikhya At-Turaz Al-Islami, Society of the Rebirth of the Islamic People
Jamiatul-Yahya Ut Turaz
Jomiatul Ehya-Ut Turaj
Jomiyatu-Ehya-Ut Turas Al Islami
Jama'ah Ihya Al-Turaz Al-Islami
Jami'ah Al-Hiya Al-Turath Al Islamiyah
Lajnat Ihya Al-Turath Al-Islami
Lajnat Al-Ihya Al-Turath Al-Islami
RIHS Administration for the Building of Mosques and Islamic Projects
RIHS Mosques Committee
Administration of the Revival of Islamic Heritage Society Committee
RIHS Arab World Committee
RIHS Committee for the Arab World
RIHS Committee for West Asia
RIHS Central Asia Committee
Committee for Europe and the Americas
RIHS Europe and the Americas Committee
RIHS Two Americas and European Muslim Committee
RIHS Europe America Muslims Committee
RIHS Southeast Asia Committee
RIHS Committee for South East Asia
RIHS Indian Continent Committee
RIHS Indian Subcontinent Committee
RIHS Committee for India
RIHS African Continent Committee
RIHS Committee for Africa
Revival of Islamic Society Heritage on the African Continent
RIHS Public Relations Committee
RIHS Cultural Committee
RIHS Principle Committee for the Center for Preservation of the Holy Qu'aran
RIHS General Committee for Donations
RIHS Youth Center Committee
RIHS Scientific Committee-Branch of Sabah Al-Nasir
RIHS Fatwas Committee
RIHS Center for Manuscripts Committee
RIHS Educating Committees, Al-Jahra'
RIHS Audio Recordings Committee
RIHS Project of Assigning Preachers Committee
RIHS Office of Printing and Publishing
RIHS Committee for Women
RIHS Committee for Women, Administration for the Building of Mosques
RIHS Women's Branch for the Project of Endowment
RIHS Administration for the Committees of Almsgiving
RIHS Committee for Almsgiving and Charities
RIHS Committee for the Call and Guidance
RIHS-Cambodia
RIHS Cambodia-Kuwait Orphanage Center
The Kuwaiti-Cambodian Orphanage Center
The Kuwait-Cambodia Islamic Cultural Training Center
RIHS Chaom Chau Center
Nara Welfare and Education Association
RIHS-Bosnia and Herzegovina
Kuwaiti Joint Relief Committee, Bosnia and Herzegovina
KJRC-Bosnia and Herzegovina
Plandiste School, Bosnia and Herzegovina
Organizacija Preporoda Islamske Tradicije Kuvajt
Kuwait General Committee for Aid
General Kuwait Committee
RIHS-Albania
Center of Call for Wisdom
CCFW
Thirrja Per Utesi
NGO Turath
RIHS-Kosovo
Dora E Miresise
Hand of Mercy
RIHS-Azerbaijan
RIHS-Russia
RIHS-Lebanon
RIHS-Bangladesh
RIHS-Somalia
RIHS-Ghana
RIHS-Tanzania
RIHS-Benin
RIHS-Cameroon
RIHS-Senegal
RIHS-Nigeria
RIHS-Liberia
RIHS-Ivory Coast
Addresses: Part 5, Qurtaba, P.O. Box 5585, Safat, Kuwait
House #40, Lake Drive Road, Sector #7, Uttara, Dhaka, Bangladesh
Number 28 Mula Mustafe Baseskije Street, Sarajevo, Bosnia and Herzegovina
Number 2 Plandiste Street, Sarajevo, Bosnia and Herzegovina
M.M. Baseskije Street, No.28p, Sarajevo, Bosnia and Herzegovina
Number 6 Donji Hotonj Street, Sarajevo, Bosnia and Herzegovina
RIHS Office, Ilidza, Bosnia and Herzegovina
RIHS Alija House, Ilidza, Bosnia and Herzegovina
RIHS Office, Tirana, Albania
RIHS Office, Pristina, Kosovo
Tripoli, Lebanon
City of Sidon, Lebanon
Dangkor District, Phnom Penh, Cambodia
Kismayo, Somalia
Kaneshi Quarter of Accra, Ghana
Al-Andalus, Kuwait
Al-Jahra', Kuwait
Al-Qurayn, Kuwait
Sabah Al-Nasir, Kuwait
Qurtubah, Kuwait
Hadiyah, Kuwait
Al-Qadisiyah, Kuwait
Al-Fayha', Kuwait
Al-Riqah, Kuwait
Al-Firdaws, Kuwait
Khitan, Kuwait
Al-Sabahiyah, Kuwait
Jalib Al-Shiyukh, Kuwait
Bayan Wa Mashrif, Kuwait
Sabah Al-Salim, Kuwait
Al-Rumaythiyah, Kuwait
Al-Salimiyah, Kuwait
Al-Aridiyah, Kuwait
Al-Khalidiya, Kuwait
Al-Dhahr, Kuwait
Al-Rawdah, Kuwait
Al-Shamiyah Wa Al-Shuwaykh, Kuwait
Al-Amiriyah, Kuwait
Al-Nuzhah, Kuwait
Kifan, Kuwait
Website: www.alturath.org
Source: US Department of Treasury Press Room
Labels:
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Al Qaeda,
Albania,
Bangladesh,
India,
Kuwait,
Pakistan,
Terrorism,
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on Saturday, May 12, 2012
MINA News: Since yesterday, the Macedonian police is in action at various locations in Skopje, due to the tip it received for suspicious money transfer.
Our sources confirm, a Macedonian bank had tipped off the Authorities since January 2007 of suspicious money transfers. An Albanian, Bekir Halimi has been receiving 2,115 euros payments from Kuwaiti Organization "Revival Islamic Heritage Society".
"The Revival Islamic Heritage Society has been blacklisted by the United Nations because of their close ties to terrorist organizations, including Al Qaeda", said Interior Ministry's spokesperson, Ivo Kotevski.
The money transfer through a swift account was done via Kuwaiti and two German banks evnetually ending up on Halimi's account.
According to the Interior Ministry's counter terrorism unit, Bekir Halimi had central role in all activities in the financing of humanitarian organization Bamiresija.
Macedonian Police had entered Bamiresija's facilities to investigate. It entered the operational facility on Lazar Iliev street, the praying areas on Petre Gorgiev street #63, the publishing house Nun, on Lazar Tanev street as well as the Trade Organization "R-Orient" and Studio Facility on Pance Nedolkovski street.
For a humanitarian organization, there are certainly many facilities. According to our source who spoke on condition of anonymity, these "humanitarian" organizations are used primarily for financing terrorism as well as money laundering.
Macedonian police seized electronic equipment, financial information. No charges have been filed so far as the investigation is ongoing, however, Bekir Halimi may face charges on financing terrorism, unlawful financial work, money laundering. Connections are sought on a global level between Halimi's organization and others.
Our sources confirmed there are suspicion that Halimis' organization has been accepting money from other organizations as well. The annual funds Bamiersija has received surpass 4.5 milion euros.
It is thought, the groupations are connected through out the Balkans, in Kosovo, Albania, Sandzak, Bosnia, Montenegro, coordinated by very powerful organization at a global level.
Halimi's organization is contrary to the constitutional laws of Macedonia with their goal being the creation of sharia law in this country.
http://serbblog.blogspot.com/2008/05/kuwait-financing-forming-of-al-qaeda.html
Our sources confirm, a Macedonian bank had tipped off the Authorities since January 2007 of suspicious money transfers. An Albanian, Bekir Halimi has been receiving 2,115 euros payments from Kuwaiti Organization "Revival Islamic Heritage Society".
"The Revival Islamic Heritage Society has been blacklisted by the United Nations because of their close ties to terrorist organizations, including Al Qaeda", said Interior Ministry's spokesperson, Ivo Kotevski.
The money transfer through a swift account was done via Kuwaiti and two German banks evnetually ending up on Halimi's account.
According to the Interior Ministry's counter terrorism unit, Bekir Halimi had central role in all activities in the financing of humanitarian organization Bamiresija.
Macedonian Police had entered Bamiresija's facilities to investigate. It entered the operational facility on Lazar Iliev street, the praying areas on Petre Gorgiev street #63, the publishing house Nun, on Lazar Tanev street as well as the Trade Organization "R-Orient" and Studio Facility on Pance Nedolkovski street.
For a humanitarian organization, there are certainly many facilities. According to our source who spoke on condition of anonymity, these "humanitarian" organizations are used primarily for financing terrorism as well as money laundering.
Macedonian police seized electronic equipment, financial information. No charges have been filed so far as the investigation is ongoing, however, Bekir Halimi may face charges on financing terrorism, unlawful financial work, money laundering. Connections are sought on a global level between Halimi's organization and others.
Our sources confirmed there are suspicion that Halimis' organization has been accepting money from other organizations as well. The annual funds Bamiersija has received surpass 4.5 milion euros.
It is thought, the groupations are connected through out the Balkans, in Kosovo, Albania, Sandzak, Bosnia, Montenegro, coordinated by very powerful organization at a global level.
Halimi's organization is contrary to the constitutional laws of Macedonia with their goal being the creation of sharia law in this country.
http://serbblog.blogspot.com/2008/05/kuwait-financing-forming-of-al-qaeda.html
They are a common feature in almost every society on earth; those overnight millionaires without known employment or businesses.
And they lead profligate lives. One would think planting cash was their profession. But, nay, most of them indulge in criminal activities such as drug pushing, pyramid investment schemes, corruption, computer fraud, child trafficking and gun running.
It is money got from such unlawful ways that they clean (launder) by concealing sources, then transfer to local and foreign banks or legitimate businesses.
Kenya’s economy is still reeling from the devastating effects of last year when several pyramid schemes collapsed with depositors’ billions of shillings.
It was not an isolated event the world had seen in recent years. In the Philippines, for example, close to two million people invested in pyramid schemes, having been promised weekly returns as high as 60 per cent. The hapless investors poured in their pensions, cash from abroad, and even sold homes to increase personal stakes.
The schemes collapsed with about US$ 1.4 billion of investors’ money, with their effects rippling over the entire country. Forced to repay the loans, police officers resorted to extortion while on patrol, while destitute investors turned to criminal activities.
In Albania, pyramid schemes collapsed between 1996 and 1997 when the investments accounted to a half of the country’s Gross Domestic Product. Big players of the schemes transferred out of the country more than 93 per cent (US$500 million) of its deposits.
The collapse of the schemes caused a civil war in which 2,000 people were killed and 3.5 million others displaced.
In Kenya, experts have argued that some of the economic scandals that have taken place such as Goldenberg and Anglo Leasing were examples of high-level money laundering.
It is for this reason that a number of organisations have been rooting for legislation to fight money laundering. They include the Centre for Governance and Development, the International Commission of Jurists and some members of the Parliamentary Initiatives Network.
The government first introduced the Proceeds of Crime and Anti Money Laundering Bill in 2006 but it lapsed after the First Reading (formal introduction). It was re-tabled last year but it was frozen with the end of the life of the Ninth Parliament last November.
I sighed with relief when MPs concluded debate on the Bill last Thursday upon its re-introduction, then referred it to two departmental committees for fine-tuning. The Bill awaits scrutiny by members of Finance and Trade committee on one hand, and those of Administration of Justice and Legal Affairs on the other.
It is instructive that some MPs already raised the red flag over the Bill, saying it was the work of the USA and foreign multilateral donors. I leave that to the Finance minister Amos Kimunya to explain, but my take is that Kenya urgently needs a law to fight money laundering.
But first, the highlights of the Proceeds of Crime and Anti-Money Laundering Bill, 2008.
It has a number of clauses defining acts that will be deemed as money laundering, associated offences and property that will be seen as having been acquired through criminal activities. They shall include assisting criminals hide properties acquired unlawfully as well as aiding others to benefit from proceeds of crime.
If enacted, the Bill provides that it shall be a crime to acquire or possess proceeds of crime. Anyone who fails to report any suspicion regarding the proceeds of crime will have committed an offence. To knowingly transport, transmit, transfer or receive a monetary instrument or anything with the intention of committing an offence will be illegal.
Giving tips to suspects of money laundering or providing false information to officials or bodies regulating the Act shall be an offence. Transmitting more money or monetary instruments (travellers’ cheques, personal cheques, bank cheques, money orders, investment securities, etc) into or out of Kenya shall be declared in a prescribed form at the point of entry or exit.
There are to be set up entities to implement the Bill if passed into law: The Financial Reporting Centre, the Anti-Money Laundering Advisory Committee, the Assets Recovery Agency, and the Criminal Assets Recovery Fund. The he Financial Reporting Centre is to identify proceeds of crime and fight money laundering, while Anti-Money Laundering Advisory Committee or of Financial Reporting Centre.
The Assets Recovery Agency shall be a semi-autonomous outfit under the Attorney General, charged with the duty of recovering any proceeds of money laundering. It shall also administer the monies of Criminal Assets Recovery Fund.
However, the Bill has so many weaknesses that the departmental House and MPs should fix before passing it. Last year, the Centre for Governance and Development hinted at most of the loopholes in its July edition of Bills Digest.
For example, the Bill has no links with other offences that may generate proceeds or assets that may become the subjects of offences under the proposed law. The UN Convention against corruption refers to such vices as predicate offences and they include organised crime, terrorism, human, drug, and arms trafficking, extortion, forgery, fraud, insider trading, and kidnapping.
Secondly, due to the complex nature of money laundering, the Bill should block avenues used by money launderers to dodge justice on legal technicalities. It should also lengthen the minimum period within which legal proceedings may be initiated. That is the case in best international practices.
It should also compel reporting institutions to develop a policy on training staff on money laundering and also criminalize anonymous accounts and those that are obviously in fictitious names.
The Bill should make specific provisions for those vulnerable to money laundering such as the Head of State, ministers, politicians, top private company bosses, senior public servants, judicial, military and other uniformed officers.
And records containing information on active customer accounts should not be destroyed after seven years as proposed by the Bill.
And, pray, why should most members of the proposed 17-member Anti-Money Laundering Advisory Committee be busy, senior public servants? This gives the government undue power and influence over the committee.
There is no reason why the Assets Recovery Agency should be under the Attorney General who shall also appoint its director. The agency should be delinked from the AG for independence, while its director ought to enjoy security of tenure.
This is is a timely piece of legislation.
http://www.nationmedia.com/dailynation/nmgcontententry.asp?category_id=1&newsid=123057
And they lead profligate lives. One would think planting cash was their profession. But, nay, most of them indulge in criminal activities such as drug pushing, pyramid investment schemes, corruption, computer fraud, child trafficking and gun running.
It is money got from such unlawful ways that they clean (launder) by concealing sources, then transfer to local and foreign banks or legitimate businesses.
Kenya’s economy is still reeling from the devastating effects of last year when several pyramid schemes collapsed with depositors’ billions of shillings.
It was not an isolated event the world had seen in recent years. In the Philippines, for example, close to two million people invested in pyramid schemes, having been promised weekly returns as high as 60 per cent. The hapless investors poured in their pensions, cash from abroad, and even sold homes to increase personal stakes.
The schemes collapsed with about US$ 1.4 billion of investors’ money, with their effects rippling over the entire country. Forced to repay the loans, police officers resorted to extortion while on patrol, while destitute investors turned to criminal activities.
In Albania, pyramid schemes collapsed between 1996 and 1997 when the investments accounted to a half of the country’s Gross Domestic Product. Big players of the schemes transferred out of the country more than 93 per cent (US$500 million) of its deposits.
The collapse of the schemes caused a civil war in which 2,000 people were killed and 3.5 million others displaced.
In Kenya, experts have argued that some of the economic scandals that have taken place such as Goldenberg and Anglo Leasing were examples of high-level money laundering.
It is for this reason that a number of organisations have been rooting for legislation to fight money laundering. They include the Centre for Governance and Development, the International Commission of Jurists and some members of the Parliamentary Initiatives Network.
The government first introduced the Proceeds of Crime and Anti Money Laundering Bill in 2006 but it lapsed after the First Reading (formal introduction). It was re-tabled last year but it was frozen with the end of the life of the Ninth Parliament last November.
I sighed with relief when MPs concluded debate on the Bill last Thursday upon its re-introduction, then referred it to two departmental committees for fine-tuning. The Bill awaits scrutiny by members of Finance and Trade committee on one hand, and those of Administration of Justice and Legal Affairs on the other.
It is instructive that some MPs already raised the red flag over the Bill, saying it was the work of the USA and foreign multilateral donors. I leave that to the Finance minister Amos Kimunya to explain, but my take is that Kenya urgently needs a law to fight money laundering.
But first, the highlights of the Proceeds of Crime and Anti-Money Laundering Bill, 2008.
It has a number of clauses defining acts that will be deemed as money laundering, associated offences and property that will be seen as having been acquired through criminal activities. They shall include assisting criminals hide properties acquired unlawfully as well as aiding others to benefit from proceeds of crime.
If enacted, the Bill provides that it shall be a crime to acquire or possess proceeds of crime. Anyone who fails to report any suspicion regarding the proceeds of crime will have committed an offence. To knowingly transport, transmit, transfer or receive a monetary instrument or anything with the intention of committing an offence will be illegal.
Giving tips to suspects of money laundering or providing false information to officials or bodies regulating the Act shall be an offence. Transmitting more money or monetary instruments (travellers’ cheques, personal cheques, bank cheques, money orders, investment securities, etc) into or out of Kenya shall be declared in a prescribed form at the point of entry or exit.
There are to be set up entities to implement the Bill if passed into law: The Financial Reporting Centre, the Anti-Money Laundering Advisory Committee, the Assets Recovery Agency, and the Criminal Assets Recovery Fund. The he Financial Reporting Centre is to identify proceeds of crime and fight money laundering, while Anti-Money Laundering Advisory Committee or of Financial Reporting Centre.
The Assets Recovery Agency shall be a semi-autonomous outfit under the Attorney General, charged with the duty of recovering any proceeds of money laundering. It shall also administer the monies of Criminal Assets Recovery Fund.
However, the Bill has so many weaknesses that the departmental House and MPs should fix before passing it. Last year, the Centre for Governance and Development hinted at most of the loopholes in its July edition of Bills Digest.
For example, the Bill has no links with other offences that may generate proceeds or assets that may become the subjects of offences under the proposed law. The UN Convention against corruption refers to such vices as predicate offences and they include organised crime, terrorism, human, drug, and arms trafficking, extortion, forgery, fraud, insider trading, and kidnapping.
Secondly, due to the complex nature of money laundering, the Bill should block avenues used by money launderers to dodge justice on legal technicalities. It should also lengthen the minimum period within which legal proceedings may be initiated. That is the case in best international practices.
It should also compel reporting institutions to develop a policy on training staff on money laundering and also criminalize anonymous accounts and those that are obviously in fictitious names.
The Bill should make specific provisions for those vulnerable to money laundering such as the Head of State, ministers, politicians, top private company bosses, senior public servants, judicial, military and other uniformed officers.
And records containing information on active customer accounts should not be destroyed after seven years as proposed by the Bill.
And, pray, why should most members of the proposed 17-member Anti-Money Laundering Advisory Committee be busy, senior public servants? This gives the government undue power and influence over the committee.
There is no reason why the Assets Recovery Agency should be under the Attorney General who shall also appoint its director. The agency should be delinked from the AG for independence, while its director ought to enjoy security of tenure.
This is is a timely piece of legislation.
http://www.nationmedia.com/dailynation/nmgcontententry.asp?category_id=1&newsid=123057
on Sunday, May 6, 2012
An increase in criminal gang violence and killings has done little to delay Croatia's accession to the European Union, raising fears that another Eastern European country will be admitted before it brings organised crime under control.
The country was told yesterday that it was still on track for membership and was given a timetable to complete the entry process by the end of next year, with another year for ratification by the 27 EU states. The news came despite an annual review into EU hopefuls stating that corruption and organised crime were still widespread in Croatia.
The rush to embrace Croatia is causing alarm that the EU will repeat the mistakes it made over Bulgaria and Romania, both of which were allowed in last year despite the continued influence of organised crime that is now holding up millions of euros in development aid.
It is even possible that key parts of the Lisbon Treaty could be woven into the country's accession agreement if the Irish people again vote “no” to the document in a referendum next year.
Olli Rehn, the Enlargement Commissioner, denied that the EU was offering Croatia a “blank cheque”. “The ball is in Croatia's court,” he said. “The conditional road map for Croatia should be seen as an encouragement for the country to press on with reforms. Success depends on Croatia's ability to meet the conditions for EU accession.”
The section of the report on Croatia's anti-corruption policy, however, made grim reading. “Corruption still remains widespread. The administrative capacity of state bodies for fighting corruption continues to be insufficient,” it said.
“The police need to become more effective in the fight against corruption and organised crime. Implementation of anti-corruption efforts has continued to lack co-ordination and monitoring. While the total number of corruption cases investigated so far has increased, the actual number of prosecutions remains low.”
In general the review was positive towards the Balkan countries; for the first time it suggested that Serbia could open its formal application process next year after the arrest of Radovan Karadzic. It was critical of Turkey, another country with ambitions of joining the EU, and urged it to get back on the road to reform.
Turkey started EU entry talks in 2005 — as did Croatia — but they have stalled over its refusal to normalise relations with Cyprus and the internal turmoil that led to the ruling party being taken to court for alleged unconstitutional behaviour.
Mr Rehn said: “Turkey has faced an annual political or constitutional crisis [over the last few years] which has consumed a lot of energy and caused stagnation in the essential reforms that are needed to make progress in the EU accession negotiation. The road to EU membership goes not through excuses but concrete steps.”
Ali Babacan, Turkey's Foreign Minister, said he thought that some of the EU criticisms were unfair but would issue a detailed reaction next week.
The EU enlargement review said that the other candidates — Albania, the Former Yugoslav Republic of Macedonia, Bosnia, Montenegro and Kosovo — were making limited progress on the reforms that they needed to make.
Source: TimesOnline
The country was told yesterday that it was still on track for membership and was given a timetable to complete the entry process by the end of next year, with another year for ratification by the 27 EU states. The news came despite an annual review into EU hopefuls stating that corruption and organised crime were still widespread in Croatia.
The rush to embrace Croatia is causing alarm that the EU will repeat the mistakes it made over Bulgaria and Romania, both of which were allowed in last year despite the continued influence of organised crime that is now holding up millions of euros in development aid.
It is even possible that key parts of the Lisbon Treaty could be woven into the country's accession agreement if the Irish people again vote “no” to the document in a referendum next year.
Olli Rehn, the Enlargement Commissioner, denied that the EU was offering Croatia a “blank cheque”. “The ball is in Croatia's court,” he said. “The conditional road map for Croatia should be seen as an encouragement for the country to press on with reforms. Success depends on Croatia's ability to meet the conditions for EU accession.”
The section of the report on Croatia's anti-corruption policy, however, made grim reading. “Corruption still remains widespread. The administrative capacity of state bodies for fighting corruption continues to be insufficient,” it said.
“The police need to become more effective in the fight against corruption and organised crime. Implementation of anti-corruption efforts has continued to lack co-ordination and monitoring. While the total number of corruption cases investigated so far has increased, the actual number of prosecutions remains low.”
In general the review was positive towards the Balkan countries; for the first time it suggested that Serbia could open its formal application process next year after the arrest of Radovan Karadzic. It was critical of Turkey, another country with ambitions of joining the EU, and urged it to get back on the road to reform.
Turkey started EU entry talks in 2005 — as did Croatia — but they have stalled over its refusal to normalise relations with Cyprus and the internal turmoil that led to the ruling party being taken to court for alleged unconstitutional behaviour.
Mr Rehn said: “Turkey has faced an annual political or constitutional crisis [over the last few years] which has consumed a lot of energy and caused stagnation in the essential reforms that are needed to make progress in the EU accession negotiation. The road to EU membership goes not through excuses but concrete steps.”
Ali Babacan, Turkey's Foreign Minister, said he thought that some of the EU criticisms were unfair but would issue a detailed reaction next week.
The EU enlargement review said that the other candidates — Albania, the Former Yugoslav Republic of Macedonia, Bosnia, Montenegro and Kosovo — were making limited progress on the reforms that they needed to make.
Source: TimesOnline
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on Sunday, March 25, 2012
A new report from the European Commission notes progress but still finds too much organized crime and corruption in the two new member states
When Bulgaria and Romania joined the European Union in 2007, other member states expressed serious concern about the high level of corruption in both of the former communist states, and, in Bulgaria, about the political power wielded by violent criminal gangs operating there. Now, some 30 months after joining the union, widespread fraud, corruption, and organized crime remain problematic according to new European Union reports that openly question the will of political leaders to implement reforms to tackle these problems.
The latest progress reports on the justice system and fight against corruption, released on 22 July, come as a serious if not unexpected blow to Bulgaria and Romania – which suffer from the public perception they were accepted into the EU club too early – but also to EU candidate countries where accession talks have stalled, such as Croatia and perennial hopeful Turkey.
PLAY OR PAY
While noting Bulgaria's and Romania's progress in key areas, the European Commission, as in previous reports since 2007, listed an array of ills, among them inadequate measures to fight money-laundering and killings linked to organized crime. In total, the reports named 21 areas in which Bulgaria needs to improve its performance, and 16 for Romania, including the implementation of anti-corruption laws and boosting the judicial independence.
"The reform momentum that has been established now needs to be backed up by a national political consensus involving all political parties and institutions, and more convincing delivery of results," European Commission President Jose Manuel Barroso said in a statement. "Citizens in both countries and across the rest of Europe must feel that no one is above the law. I hope that the two governments will move quickly to implement the concrete recommendations for reform that the Commission has put forward."
The commission last year froze around 500 million euros in subsidies earmarked to help the Bulgarian economy and threatened to sanction Romania as well over exactly the same kinds of failings outlined in this week's reports.
This time the commission decided not to advise other member states to stop cooperation with Bulgaria and Romania on judicial issues, an option known as the "safeguard clause" in the two countries' accession agreements. Brussels also stopped short of saying that the shortcomings could imperil the countries' attempts to join the border-free Schengen area in 2011.
But the commission will extend into 2010 the monitoring system, known as the Cooperation and Verification Mechanism, with the next progress report due in a year's time. That extension is a political embarrassment for Sofia and Bucharest – and a wake-up call for Croatia to also get its house in order. EU Enlargement Commissioner Olli Rehn noted that Zagreb is also lagging in "key areas such as judicial and administrative reform, the fight against corruption, and organized crime."
BIG JOB FOR NEW BULGARIAN LEADER
Whether this will instill a need to fast-track reforms remains to be seen. Indeed, the commission – which has already barred two Bulgarian government agencies from handling EU funds – said in its latest report that while Sofia no longer is denying that organized crime and corruption are widespread, the political will to do something about it is not yet evident.
"In the public perception in Bulgaria justice is too slow" and is "subject to influence and interference," Johannes Leitenberger, chief spokesperson for the commission, told reporters in Brussels, as cited by EUobserver.com. "There are still shortcomings which need to be urgently addressed by the newly elected Bulgarian government."
The commission released the latest judicial and crime monitoring reports days before the scheduled swearing-in of Bulgaria's incoming prime minister, Boyko Borisov, the Sofia mayor and a former Interior Ministry official who won elections this month on an anti-corruption platform. His party GERB (Citizens for the European Development of Bulgaria) also pledged to go after former government officials suspected of graft and has promised to implement the commission's demands.
If Borisov talks tough, he may well have the background and political muscle to back up his words. The private security company he founded helped protect Bulgaria's deposed last communist leader, Todor Zhivkov, and on the other side of the political spectrum, Simeon Saxecoburggotski, the deposed monarch who returned from exile and served as premier from 2001 until 2005.
MILD PRAISE FOR BUCHAREST
Romania – criticized for its fragmented and politicized approach to reform – did earn praise for the work of its anti-corruption directorate. Organized crime is also seen as far less of a problem than in Bulgaria. According to the commission, the country's criminal and civil codes, while updated, have not been fully or systematically revised, leading to a "patchwork" of ad hoc legislation that risks compromising anti-corruption efforts.
In Romania, "reform efforts remain fragmented, they have not yet taken firmly root and must still produce practical results," the commission stated. "Overall, a broad based political consensus behind reform and an unequivocal commitment across political parties to real progress has still to be demonstrated." And while prosecutors in Romania have accused almost 20 cabinet ministers and former ministers of corruption since the country's accession to the bloc in 2007, not one has been convicted.
Opinion polls show EU citizens have grown more wary of bringing new countries into the bloc since the "early admission" of Bulgaria and Romania – and the perception of lawlessness in the region is a factor. But without the "carrot" of that qualified (i.e. monitored) membership and the "stick" of sanctions, the wheels of judicial reform in these countries would have turned far slower. The message to EU candidates Croatia, Turkey, and Macedonia and those waiting in the wings (Serbia, Montenegro, Bosnia, and Albania) is to raise the bar – accelerate reforms – ahead of entry or formal accession talks.
Likewise, if Brussels should renege on the promise of future membership to the Balkans it could destabilize an already volatile region, right on the EU border. In that regard, Enlargement Commissioner Rehn was right this month to propose offering visa-free travel for citizens of Macedonia, Serbia, and Montenegro from 1 January 2010, in an effort to bring these countries closer to the bloc even as Brussels pushes for faster political, judicial, and economic progress.
Source: BusinessWeek
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on Sunday, February 26, 2012
The traffic of heroin is the main criminal activity in the so-called South East criminal hub in Europe, according to the Europol Report.
Europol, or the European Police Office, released their Europol Organized Crime Threat Assessment (OCTA) in which the criminal activities on the old continent are divided in five hubs where the hub is a conceptual entity that is generated by a combination of factors such as proximity to major destination markets, geographic location, infrastructure, types of organized crime groups and migration processes concerning key criminals or organized crime groups in general.
The OCTA is an assessment of current and expected trends in organized crime affecting the EU and its citizens. Based on analysis Europol assess that the most significant criminal sectors now are drug trafficking, human trafficking, illegal immigration, fraud, counterfeiting and money laundering.
Bulgaria falls within the South East hub where the “Balkan route” from Turkey to the EU is used for heroin traffic by Turkish criminals, often in cooperation with Bulgarian crime groups.
“The South East criminal hub is based upon its geographical location between Asia and Europe. Logistically, the importance of the Black Sea and related waterways define the hub and will create opportunities for both legal trade and organized crime. Opiates reach Europe through the Balkan routes and the Northern Black Sea route across Central Asia and Russia. The significance of the port of Constanta in cocaine traffic is growing, and cocaine seems to be increasingly arriving into the EU via Turkey and/or the Balkans. This may also be the effect of the already well-established role of West Africa as a transit zone,” the report reads.
Bulgarians and Serbians also play key role in the traffic of synthetic drugs to the Middle East. Nigerian criminal groups, residing in Bulgaria, are in constant touch with such Nigerian groups in Italy providing cocaine for the Italian market, Europol notes.
In addition to synthetic drugs Bulgaria plays a key role in the distribution of counterfeit EUR bills and fake bank debit and credit cards.
The Southeastern hub is also very active in cigarettes contraband from the Ukraine and Moldova to the EU. In addition, the Ukraine is a transit center for cocaine, human trafficking and illegal immigrants through Albania, Serbia, Kosovo, Monte Negro and Macedonia to the EU.
The other hubs are:
1) The North West criminal hub. It is a distribution centre for heroin, cocaine, synthetic drugs and cannabis products. Its influence extends to the UK, Ireland, France, Spain, Germany and the Baltic and Scandinavian countries.
2) The South West criminal hub. The impact of this market is felt especially in the criminal markets of cocaine, cannabis, trafficking in human beings and illegal immigration. West and North West Africa as well as other parts of this continent have emerged as significant feeders for either the South West criminal hub or, increasingly, directly to important markets and distribution centers in the EU.
3) The North East criminal hub. This area is and will continue to be strongly influenced by feeders and transit zones located just outside the eastern EU borders (the Russian Federation/Kaliningrad, the Ukraine and Belarus). Illicit flows may be traced from the East towards the West (women for sexual exploitation, illegal immigrants, cigarettes, counterfeit goods, synthetic drugs precursors and heroin) but also vice versa (cocaine and cannabis products).
4) The Southern criminal hub. The role of this hub is central in relation to cigarette smuggling, the smuggling and distribution of counterfeit products and the production of counterfeit EUR bills.
Source: Novinite
Europol, or the European Police Office, released their Europol Organized Crime Threat Assessment (OCTA) in which the criminal activities on the old continent are divided in five hubs where the hub is a conceptual entity that is generated by a combination of factors such as proximity to major destination markets, geographic location, infrastructure, types of organized crime groups and migration processes concerning key criminals or organized crime groups in general.
The OCTA is an assessment of current and expected trends in organized crime affecting the EU and its citizens. Based on analysis Europol assess that the most significant criminal sectors now are drug trafficking, human trafficking, illegal immigration, fraud, counterfeiting and money laundering.
Bulgaria falls within the South East hub where the “Balkan route” from Turkey to the EU is used for heroin traffic by Turkish criminals, often in cooperation with Bulgarian crime groups.
“The South East criminal hub is based upon its geographical location between Asia and Europe. Logistically, the importance of the Black Sea and related waterways define the hub and will create opportunities for both legal trade and organized crime. Opiates reach Europe through the Balkan routes and the Northern Black Sea route across Central Asia and Russia. The significance of the port of Constanta in cocaine traffic is growing, and cocaine seems to be increasingly arriving into the EU via Turkey and/or the Balkans. This may also be the effect of the already well-established role of West Africa as a transit zone,” the report reads.
Bulgarians and Serbians also play key role in the traffic of synthetic drugs to the Middle East. Nigerian criminal groups, residing in Bulgaria, are in constant touch with such Nigerian groups in Italy providing cocaine for the Italian market, Europol notes.
In addition to synthetic drugs Bulgaria plays a key role in the distribution of counterfeit EUR bills and fake bank debit and credit cards.
The Southeastern hub is also very active in cigarettes contraband from the Ukraine and Moldova to the EU. In addition, the Ukraine is a transit center for cocaine, human trafficking and illegal immigrants through Albania, Serbia, Kosovo, Monte Negro and Macedonia to the EU.
The other hubs are:
1) The North West criminal hub. It is a distribution centre for heroin, cocaine, synthetic drugs and cannabis products. Its influence extends to the UK, Ireland, France, Spain, Germany and the Baltic and Scandinavian countries.
2) The South West criminal hub. The impact of this market is felt especially in the criminal markets of cocaine, cannabis, trafficking in human beings and illegal immigration. West and North West Africa as well as other parts of this continent have emerged as significant feeders for either the South West criminal hub or, increasingly, directly to important markets and distribution centers in the EU.
3) The North East criminal hub. This area is and will continue to be strongly influenced by feeders and transit zones located just outside the eastern EU borders (the Russian Federation/Kaliningrad, the Ukraine and Belarus). Illicit flows may be traced from the East towards the West (women for sexual exploitation, illegal immigrants, cigarettes, counterfeit goods, synthetic drugs precursors and heroin) but also vice versa (cocaine and cannabis products).
4) The Southern criminal hub. The role of this hub is central in relation to cigarette smuggling, the smuggling and distribution of counterfeit products and the production of counterfeit EUR bills.
Source: Novinite
on Monday, April 2, 2007
Three Italians arrested in connection with a European Union kickback probe now face additional charges of money laundering, judicial officials in Brussels said on Thursday.
Jos Colpin, the spokesman of Brussels public prosecutor Berta Bernardo-Mendez, said the three suspects - who include an EC official and the assistant of an MEP - were accused of money laundering as well as corruption, fraud, criminal conspiracy, forgery and breaching public tender laws.
Commission functionary Giancarlo Ciotti, 46, European parliamentary assistant Sergio Tricarico, 39, and businessman Angelo Troiano, 60, were arrested on Wednesday in Brussels.
Colpin said the three, who are all resident in Brussels, were suspected of defrauding European taxpayers of several million euros over a period going back more than ten years.
The probe centres on tenders for European Commission offices abroad and contracts for supplying these buildings with security systems.
Ciotti is suspected of pocketing bribes from real estate and security companies in return for the assignment of contracts to rent, equip and secure EC buildings, in India and Albania in particular.
“It was a matter of not following the rules of public tenders which made it possible to favour certain firms which were obliged to pay bribes to those who organised the fraud,” Colpin said after the arrests.
He said it appeared to be a “very big case of corruption” and that Italy was the suspected “epicentre”.
EC offices in Brussels and banks, homes and private offices in Italy, France and Luxembourg were searched on Tuesday in an operation involving more than 150 police officers.
The investigation began in July 2004 when the EC received a complaint from an unsuccessful bidder in a tender procedure.
The commission immediately notified its anti-fraud agency OLAF.
Tricarico is an assistant to MEP Gianni Rivera, a former soccer star turned politician. Prior to that, Tricarico worked for Franco Marini, who is now Italy’s Senate speaker.
Rivera said on Wednesday said he was “stunned” by Tricarico’s arrest and had “never noticed anything suspicious” about his behaviour.
Troiano is a real estate agent and owner of several private security installation and supply firms.
Media reports, meanwhile, spotlighted alleged anomalies associated with the EC building in Tirana.
Used to house EC delegations, the building is situated on the outskirts of the Albanian capital and is owned by a private company, one of whose partners is an Italian businessman based in Potenza.
The media reported that the building cost the EC 40-50,000 euros a month to rent - much more than the market price for properties in the centre of the capital.
The EC budget for commission delegations’ buildings abroad stands at around 56 million euros for 2007.
The Italian foreign ministry said on Thursday that it was “looking into the judicial position” of the three arrested Italians and would “ensure they are guaranteed all their defence rights”.
Judicial sources close to the probe said it could widen and that more arrests were possible.
http://www.italymag.co.uk/2007/news-from-italy/current-affairs/italians-in-eu-graft-probe-face-money-laundering-charges/
Jos Colpin, the spokesman of Brussels public prosecutor Berta Bernardo-Mendez, said the three suspects - who include an EC official and the assistant of an MEP - were accused of money laundering as well as corruption, fraud, criminal conspiracy, forgery and breaching public tender laws.
Commission functionary Giancarlo Ciotti, 46, European parliamentary assistant Sergio Tricarico, 39, and businessman Angelo Troiano, 60, were arrested on Wednesday in Brussels.
Colpin said the three, who are all resident in Brussels, were suspected of defrauding European taxpayers of several million euros over a period going back more than ten years.
The probe centres on tenders for European Commission offices abroad and contracts for supplying these buildings with security systems.
Ciotti is suspected of pocketing bribes from real estate and security companies in return for the assignment of contracts to rent, equip and secure EC buildings, in India and Albania in particular.
“It was a matter of not following the rules of public tenders which made it possible to favour certain firms which were obliged to pay bribes to those who organised the fraud,” Colpin said after the arrests.
He said it appeared to be a “very big case of corruption” and that Italy was the suspected “epicentre”.
EC offices in Brussels and banks, homes and private offices in Italy, France and Luxembourg were searched on Tuesday in an operation involving more than 150 police officers.
The investigation began in July 2004 when the EC received a complaint from an unsuccessful bidder in a tender procedure.
The commission immediately notified its anti-fraud agency OLAF.
Tricarico is an assistant to MEP Gianni Rivera, a former soccer star turned politician. Prior to that, Tricarico worked for Franco Marini, who is now Italy’s Senate speaker.
Rivera said on Wednesday said he was “stunned” by Tricarico’s arrest and had “never noticed anything suspicious” about his behaviour.
Troiano is a real estate agent and owner of several private security installation and supply firms.
Media reports, meanwhile, spotlighted alleged anomalies associated with the EC building in Tirana.
Used to house EC delegations, the building is situated on the outskirts of the Albanian capital and is owned by a private company, one of whose partners is an Italian businessman based in Potenza.
The media reported that the building cost the EC 40-50,000 euros a month to rent - much more than the market price for properties in the centre of the capital.
The EC budget for commission delegations’ buildings abroad stands at around 56 million euros for 2007.
The Italian foreign ministry said on Thursday that it was “looking into the judicial position” of the three arrested Italians and would “ensure they are guaranteed all their defence rights”.
Judicial sources close to the probe said it could widen and that more arrests were possible.
http://www.italymag.co.uk/2007/news-from-italy/current-affairs/italians-in-eu-graft-probe-face-money-laundering-charges/
on Thursday, February 22, 2007
If you shop with a major bank, chances are that all the transactions in your account are scrutinized by AML (Anti Money Laundering) software. Billions of dollars are being invested in these applications. They are supposed to track suspicious transfers, deposits, and withdrawals based on overall statistical patterns. Bank directors, exposed, under the Patriot Act, to personal liability for money laundering in their establishments, swear by it as a legal shield and the holy grail of the on-going war against financial crime and the finances of terrorism.
Quoted in Wired.com, Neil Katkov of Celent Communications, pegs future investments in compliance-related activities and products by American banks alone at close to $15 billion in the next 3 years (2005-2008). The United State's Treasury Department's Financial Crimes Enforcement Network (finCEN) received c. 15 million reports in each of the years 2003 and 2004.
But this is a drop in the seething ocean of illicit financial transactions, sometimes egged on and abetted even by the very Western governments ostensibly dead set against them.
Israel has always turned a blind eye to the origin of funds deposited by Jews from South Africa to Russia. In Britain it is perfectly legal to hide the true ownership of a company. Underpaid Asian bank clerks on immigrant work permits in the Gulf states rarely require identity documents from the mysterious and well-connected owners of multi-million dollar deposits.
Hawaladars continue plying their paperless and trust-based trade - the transfer of billions of US dollars around the world. American and Swiss banks collaborate with dubious correspondent banks in off shore centres. Multinationals shift money through tax free territories in what is euphemistically known as "tax planning". Internet gambling outfits and casinos serve as fronts for narco-dollars. British Bureaux de Change launder up to 2.6 billion British pounds annually.
The 500 Euro note makes it much easier to smuggle cash out of Europe. A French parliamentary committee accused the City of London of being a money laundering haven in a 400 page report. Intelligence services cover the tracks of covert operations by opening accounts in obscure tax havens, from Cyprus to Nauru. Money laundering, its venues and techniques, are an integral part of the economic fabric of the world. Business as usual?
Not really. In retrospect, as far as money laundering goes, September 11 may be perceived as a watershed as important as the precipitous collapse of communism in 1989. Both events have forever altered the patterns of the global flows of illicit capital.
What is Money Laundering?
Strictly speaking, money laundering is the age-old process of disguising the illegal origin and criminal nature of funds (obtained in sanctions-busting arms sales, smuggling, trafficking in humans, organized crime, drug trafficking, prostitution rings, embezzlement, insider trading, bribery, and computer fraud) by moving them untraceably and investing them in legitimate businesses, securities, or bank deposits. But this narrow definition masks the fact that the bulk of money laundered is the result of tax evasion, tax avoidance, and outright tax fraud, such as the "VAT carousel scheme" in the EU (moving goods among businesses in various jurisdictions to capitalize on differences in VAT rates). Tax-related laundering nets between 10-20 billion US dollars annually from France and Russia alone. The confluence of criminal and tax averse funds in money laundering networks serves to obscure the sources of both.
The Scale of the Problem
According to a 1996 IMF estimate, money laundered annually amounts to 2-5% of world GDP (between 800 billion and 2 trillion US dollars in today's terms). The lower figure is considerably larger than an average European economy, such as Spain's.
The System
It is important to realize that money laundering takes place within the banking system. Big amounts of cash are spread among numerous accounts (sometimes in free economic zones, financial off shore centers, and tax havens), converted to bearer financial instruments (money orders, bonds), or placed with trusts and charities. The money is then transferred to other locations, sometimes as bogus payments for "goods and services" against fake or inflated invoices issued by holding companies owned by lawyers or accountants on behalf of unnamed beneficiaries. The transferred funds are re-assembled in their destination and often "shipped" back to the point of origin under a new identity. The laundered funds are then invested in the legitimate economy. It is a simple procedure - yet an effective one. It results in either no paper trail - or too much of it. The accounts are invariably liquidated and all traces erased.
Why is It a Problem?
Criminal and tax evading funds are idle and non-productive. Their injection, however surreptitiously, into the economy transforms them into a productive (and cheap) source of capital. Why is this negative?
Because it corrupts government officials, banks and their officers, contaminates legal sectors of the economy, crowds out legitimate and foreign capital, makes money supply unpredictable and uncontrollable, and increases cross-border capital movements, thereby enhancing the volatility of exchange rates.
A multilateral, co-ordinated, effort (exchange of information, uniform laws, extra-territorial legal powers) is required to counter the international dimensions of money laundering. Many countries opt in because money laundering has also become a domestic political and economic concern. The United Nations, the Bank for International Settlements, the OECD's FATF (Financial Action Task Force), the EU, the Council of Europe, the Organisation of American States, all published anti-money laundering standards. Regional groupings were formed (or are being established) in the Caribbean, Asia, Europe, southern Africa, western Africa, and Latin America.
Money Laundering in the Wake of the September 11 Attacks
Regulation
The least important trend is the tightening of financial regulations and the establishment or enhancement of compulsory (as opposed to industry or voluntary) regulatory and enforcement agencies.
New legislation in the US which amounts to extending the powers of the CIA domestically and of the DOJ extra-territorially, was rather xenophobically described by a DOJ official, Michael Chertoff, as intended to "make sure the American banking system does not become a haven for foreign corrupt leaders or other kinds of foreign organized criminals."
Privacy and bank secrecy laws have been watered down. Collaboration with off shore "shell" banks has been banned. Business with clients of correspondent banks was curtailed. Banks were effectively transformed into law enforcement agencies, responsible to verify both the identities of their (foreign) clients and the source and origin of their funds. Cash transactions were partly criminalized. And the securities and currency trading industry, insurance companies, and money transfer services are subjected to growing scrutiny as a conduit for "dirty cash".
Still, such legislation is highly ineffective. The American Bankers' Association puts the cost of compliance with the laxer anti-money-laundering laws in force in 1998 at 10 billion US dollars - or more than 10 million US dollars per obtained conviction. Even when the system does work, critical alerts drown in the torrent of reports mandated by the regulations. One bank actually reported a suspicious transaction in the account of one of the September 11 hijackers - only to be ignored.
The Treasury Department established Operation Green Quest, an investigative team charged with monitoring charities, NGO's, credit card fraud, cash smuggling, counterfeiting, and the Hawala networks. This is not without precedent. Previous teams tackled drug money, the biggest money laundering venue ever, BCCI (Bank of Credit and Commerce International), and ... Al Capone. The more veteran, New-York based, El-Dorado anti money laundering Task Force (established in 1992) will lend a hand and share information.
More than 150 countries promised to co-operate with the US in its fight against the financing of terrorism - 81 of which (including the Bahamas, Argentina, Kuwait, Indonesia, Pakistan, Switzerland, and the EU) actually froze assets of suspicious individuals, suspected charities, and dubious firms, or passed new anti money laundering laws and stricter regulations (the Philippines, the UK, Germany).
A EU directive now forces lawyers to disclose incriminating information about their clients' money laundering activities. Pakistan initiated a "loyalty scheme", awarding expatriates who prefer official bank channels to the much maligned (but cheaper and more efficient) Hawala, with extra baggage allowance and special treatment in airports.
The magnitude of this international collaboration is unprecedented. But this burst of solidarity may yet fade. China, for instance, refuses to chime in. As a result, the statement issued by APEC in November 2001 on measures to stem the finances of terrorism was lukewarm at best. And, protestations of close collaboration to the contrary, Saudi Arabia has done nothing to combat money laundering "Islamic charities" (of which it is proud) on its territory.
Still, a universal code is emerging, based on the work of the OECD's FATF (Financial Action Task Force) since 1989 (its famous "40 recommendations") and on the relevant UN conventions. All countries are expected by the West, on pain of possible sanctions, to adopt a uniform legal platform (including reporting on suspicious transactions and freezing assets) and to apply it to all types of financial intermediaries, not only to banks. This is likely to result in...
The Decline of off Shore Financial Centres and Tax Havens
By far the most important outcome of this new-fangled juridical homogeneity is the acceleration of the decline of off shore financial and banking centres and tax havens. The distinction between off-shore and on-shore will vanish. Of the FATF's "name and shame" blacklist of 19 "black holes" (poorly regulated territories, including Israel, Indonesia, and Russia) - 11 have substantially revamped their banking laws and financial regulators.
Coupled with the tightening of US, UK, and EU laws and the wider interpretation of money laundering to include political corruption, bribery, and embezzlement - this would make life a lot more difficult for venal politicians and major tax evaders. The likes of Sani Abacha (late President of Nigeria), Ferdinand Marcos (late President of the Philippines), Vladimiro Montesinos (former, now standing trial, chief of the intelligence services of Peru), or Raul Salinas (the brother of Mexico's President) - would have found it impossible to loot their countries to the same disgraceful extent in today's financial environment. And Osama bin Laden would not have been able to wire funds to US accounts from the Sudanese Al Shamal Bank, the "correspondent" of 33 American banks.
Quo Vadis, Money Laundering?
Crime is resilient and fast adapting to new realities. Organized crime is in the process of establishing an alternative banking system, only tangentially connected to the West's, in the fringes, and by proxy. This is done by purchasing defunct banks or banking licences in territories with lax regulation, cash economies, corrupt politicians, no tax collection, but reasonable infrastructure.
The countries of Eastern Europe - Yugoslavia (Montenegro and Serbia), Macedonia, Ukraine, Moldova, Belarus, Albania, to mention a few - are natural targets. In some cases, organized crime is so all-pervasive and local politicians so corrupt that the distinction between criminal and politician is spurious.
Gradually, money laundering rings move their operations to these new, accommodating territories. The laundered funds are used to purchase assets in intentionally botched privatizations, real estate, existing businesses, and to finance trading operations. The wasteland that is Eastern Europe craves private capital and no questions are asked by investor and recipient alike.
The next frontier is cyberspace. Internet banking, Internet gambling, day trading, foreign exchange cyber transactions, e-cash, e-commerce, fictitious invoicing of the launderer's genuine credit cards - hold the promise of the future. Impossible to track and monitor, ex-territorial, totally digital, amenable to identity theft and fake identities - this is the ideal vehicle for money launderers. This nascent platform is way too small to accommodate the enormous amounts of cash laundered daily - but in ten years time, it may. The problem is likely to be exacerbated by the introduction of smart cards, electronic purses, and payment-enabled mobile phones.
In its "Report on Money Laundering Typologies" (February 2001) the FATF was able to document concrete and suspected abuses of online banking, Internet casinos, and web-based financial services. It is difficult to identify a customer and to get to know it in cyberspace, was the alarming conclusion. It is equally complicated to establish jurisdiction.
Many capable professionals - stockbrokers, lawyers, accountants, traders, insurance brokers, real estate agents, sellers of high value items such as gold, diamonds, and art - are employed or co-opted by money laundering operations. Money launderers are likely to make increased use of global, around the clock, trading in foreign currencies and derivatives. These provide instantaneous transfer of funds and no audit trail.
The underlying securities involved are susceptible to market manipulation and fraud. Complex insurance policies (with the "wrong" beneficiaries), and the securitization of receivables, leasing contracts, mortgages, and low grade bonds are already used in money laundering schemes. In general, money laundering goes well with risk arbitraging financial instruments.
Trust-based, globe-spanning, money transfer systems based on authentication codes and generations of commercial relationships cemented in honour and blood - are another wave of the future. The Hawala and Chinese networks in Asia, the Black Market Peso Exchange (BMPE) in Latin America, other evolving courier systems in Eastern Europe (mainly in Russia, Ukraine, and Albania) and in Western Europe (mainly in France and Spain).
In conjunction with encrypted e-mail and web anonymizers, these networks are virtually impenetrable. As emigration increases, diasporas established, and transport and telecommunications become ubiquitous, "ethnic banking" along the tradition of the Lombards and the Jews in medieval Europe may become the the preferred venue of money laundering. September 11 may have retarded world civilization in more than one way.
http://www.theconservativevoice.com/article/22965.html
Quoted in Wired.com, Neil Katkov of Celent Communications, pegs future investments in compliance-related activities and products by American banks alone at close to $15 billion in the next 3 years (2005-2008). The United State's Treasury Department's Financial Crimes Enforcement Network (finCEN) received c. 15 million reports in each of the years 2003 and 2004.
But this is a drop in the seething ocean of illicit financial transactions, sometimes egged on and abetted even by the very Western governments ostensibly dead set against them.
Israel has always turned a blind eye to the origin of funds deposited by Jews from South Africa to Russia. In Britain it is perfectly legal to hide the true ownership of a company. Underpaid Asian bank clerks on immigrant work permits in the Gulf states rarely require identity documents from the mysterious and well-connected owners of multi-million dollar deposits.
Hawaladars continue plying their paperless and trust-based trade - the transfer of billions of US dollars around the world. American and Swiss banks collaborate with dubious correspondent banks in off shore centres. Multinationals shift money through tax free territories in what is euphemistically known as "tax planning". Internet gambling outfits and casinos serve as fronts for narco-dollars. British Bureaux de Change launder up to 2.6 billion British pounds annually.
The 500 Euro note makes it much easier to smuggle cash out of Europe. A French parliamentary committee accused the City of London of being a money laundering haven in a 400 page report. Intelligence services cover the tracks of covert operations by opening accounts in obscure tax havens, from Cyprus to Nauru. Money laundering, its venues and techniques, are an integral part of the economic fabric of the world. Business as usual?
Not really. In retrospect, as far as money laundering goes, September 11 may be perceived as a watershed as important as the precipitous collapse of communism in 1989. Both events have forever altered the patterns of the global flows of illicit capital.
What is Money Laundering?
Strictly speaking, money laundering is the age-old process of disguising the illegal origin and criminal nature of funds (obtained in sanctions-busting arms sales, smuggling, trafficking in humans, organized crime, drug trafficking, prostitution rings, embezzlement, insider trading, bribery, and computer fraud) by moving them untraceably and investing them in legitimate businesses, securities, or bank deposits. But this narrow definition masks the fact that the bulk of money laundered is the result of tax evasion, tax avoidance, and outright tax fraud, such as the "VAT carousel scheme" in the EU (moving goods among businesses in various jurisdictions to capitalize on differences in VAT rates). Tax-related laundering nets between 10-20 billion US dollars annually from France and Russia alone. The confluence of criminal and tax averse funds in money laundering networks serves to obscure the sources of both.
The Scale of the Problem
According to a 1996 IMF estimate, money laundered annually amounts to 2-5% of world GDP (between 800 billion and 2 trillion US dollars in today's terms). The lower figure is considerably larger than an average European economy, such as Spain's.
The System
It is important to realize that money laundering takes place within the banking system. Big amounts of cash are spread among numerous accounts (sometimes in free economic zones, financial off shore centers, and tax havens), converted to bearer financial instruments (money orders, bonds), or placed with trusts and charities. The money is then transferred to other locations, sometimes as bogus payments for "goods and services" against fake or inflated invoices issued by holding companies owned by lawyers or accountants on behalf of unnamed beneficiaries. The transferred funds are re-assembled in their destination and often "shipped" back to the point of origin under a new identity. The laundered funds are then invested in the legitimate economy. It is a simple procedure - yet an effective one. It results in either no paper trail - or too much of it. The accounts are invariably liquidated and all traces erased.
Why is It a Problem?
Criminal and tax evading funds are idle and non-productive. Their injection, however surreptitiously, into the economy transforms them into a productive (and cheap) source of capital. Why is this negative?
Because it corrupts government officials, banks and their officers, contaminates legal sectors of the economy, crowds out legitimate and foreign capital, makes money supply unpredictable and uncontrollable, and increases cross-border capital movements, thereby enhancing the volatility of exchange rates.
A multilateral, co-ordinated, effort (exchange of information, uniform laws, extra-territorial legal powers) is required to counter the international dimensions of money laundering. Many countries opt in because money laundering has also become a domestic political and economic concern. The United Nations, the Bank for International Settlements, the OECD's FATF (Financial Action Task Force), the EU, the Council of Europe, the Organisation of American States, all published anti-money laundering standards. Regional groupings were formed (or are being established) in the Caribbean, Asia, Europe, southern Africa, western Africa, and Latin America.
Money Laundering in the Wake of the September 11 Attacks
Regulation
The least important trend is the tightening of financial regulations and the establishment or enhancement of compulsory (as opposed to industry or voluntary) regulatory and enforcement agencies.
New legislation in the US which amounts to extending the powers of the CIA domestically and of the DOJ extra-territorially, was rather xenophobically described by a DOJ official, Michael Chertoff, as intended to "make sure the American banking system does not become a haven for foreign corrupt leaders or other kinds of foreign organized criminals."
Privacy and bank secrecy laws have been watered down. Collaboration with off shore "shell" banks has been banned. Business with clients of correspondent banks was curtailed. Banks were effectively transformed into law enforcement agencies, responsible to verify both the identities of their (foreign) clients and the source and origin of their funds. Cash transactions were partly criminalized. And the securities and currency trading industry, insurance companies, and money transfer services are subjected to growing scrutiny as a conduit for "dirty cash".
Still, such legislation is highly ineffective. The American Bankers' Association puts the cost of compliance with the laxer anti-money-laundering laws in force in 1998 at 10 billion US dollars - or more than 10 million US dollars per obtained conviction. Even when the system does work, critical alerts drown in the torrent of reports mandated by the regulations. One bank actually reported a suspicious transaction in the account of one of the September 11 hijackers - only to be ignored.
The Treasury Department established Operation Green Quest, an investigative team charged with monitoring charities, NGO's, credit card fraud, cash smuggling, counterfeiting, and the Hawala networks. This is not without precedent. Previous teams tackled drug money, the biggest money laundering venue ever, BCCI (Bank of Credit and Commerce International), and ... Al Capone. The more veteran, New-York based, El-Dorado anti money laundering Task Force (established in 1992) will lend a hand and share information.
More than 150 countries promised to co-operate with the US in its fight against the financing of terrorism - 81 of which (including the Bahamas, Argentina, Kuwait, Indonesia, Pakistan, Switzerland, and the EU) actually froze assets of suspicious individuals, suspected charities, and dubious firms, or passed new anti money laundering laws and stricter regulations (the Philippines, the UK, Germany).
A EU directive now forces lawyers to disclose incriminating information about their clients' money laundering activities. Pakistan initiated a "loyalty scheme", awarding expatriates who prefer official bank channels to the much maligned (but cheaper and more efficient) Hawala, with extra baggage allowance and special treatment in airports.
The magnitude of this international collaboration is unprecedented. But this burst of solidarity may yet fade. China, for instance, refuses to chime in. As a result, the statement issued by APEC in November 2001 on measures to stem the finances of terrorism was lukewarm at best. And, protestations of close collaboration to the contrary, Saudi Arabia has done nothing to combat money laundering "Islamic charities" (of which it is proud) on its territory.
Still, a universal code is emerging, based on the work of the OECD's FATF (Financial Action Task Force) since 1989 (its famous "40 recommendations") and on the relevant UN conventions. All countries are expected by the West, on pain of possible sanctions, to adopt a uniform legal platform (including reporting on suspicious transactions and freezing assets) and to apply it to all types of financial intermediaries, not only to banks. This is likely to result in...
The Decline of off Shore Financial Centres and Tax Havens
By far the most important outcome of this new-fangled juridical homogeneity is the acceleration of the decline of off shore financial and banking centres and tax havens. The distinction between off-shore and on-shore will vanish. Of the FATF's "name and shame" blacklist of 19 "black holes" (poorly regulated territories, including Israel, Indonesia, and Russia) - 11 have substantially revamped their banking laws and financial regulators.
Coupled with the tightening of US, UK, and EU laws and the wider interpretation of money laundering to include political corruption, bribery, and embezzlement - this would make life a lot more difficult for venal politicians and major tax evaders. The likes of Sani Abacha (late President of Nigeria), Ferdinand Marcos (late President of the Philippines), Vladimiro Montesinos (former, now standing trial, chief of the intelligence services of Peru), or Raul Salinas (the brother of Mexico's President) - would have found it impossible to loot their countries to the same disgraceful extent in today's financial environment. And Osama bin Laden would not have been able to wire funds to US accounts from the Sudanese Al Shamal Bank, the "correspondent" of 33 American banks.
Quo Vadis, Money Laundering?
Crime is resilient and fast adapting to new realities. Organized crime is in the process of establishing an alternative banking system, only tangentially connected to the West's, in the fringes, and by proxy. This is done by purchasing defunct banks or banking licences in territories with lax regulation, cash economies, corrupt politicians, no tax collection, but reasonable infrastructure.
The countries of Eastern Europe - Yugoslavia (Montenegro and Serbia), Macedonia, Ukraine, Moldova, Belarus, Albania, to mention a few - are natural targets. In some cases, organized crime is so all-pervasive and local politicians so corrupt that the distinction between criminal and politician is spurious.
Gradually, money laundering rings move their operations to these new, accommodating territories. The laundered funds are used to purchase assets in intentionally botched privatizations, real estate, existing businesses, and to finance trading operations. The wasteland that is Eastern Europe craves private capital and no questions are asked by investor and recipient alike.
The next frontier is cyberspace. Internet banking, Internet gambling, day trading, foreign exchange cyber transactions, e-cash, e-commerce, fictitious invoicing of the launderer's genuine credit cards - hold the promise of the future. Impossible to track and monitor, ex-territorial, totally digital, amenable to identity theft and fake identities - this is the ideal vehicle for money launderers. This nascent platform is way too small to accommodate the enormous amounts of cash laundered daily - but in ten years time, it may. The problem is likely to be exacerbated by the introduction of smart cards, electronic purses, and payment-enabled mobile phones.
In its "Report on Money Laundering Typologies" (February 2001) the FATF was able to document concrete and suspected abuses of online banking, Internet casinos, and web-based financial services. It is difficult to identify a customer and to get to know it in cyberspace, was the alarming conclusion. It is equally complicated to establish jurisdiction.
Many capable professionals - stockbrokers, lawyers, accountants, traders, insurance brokers, real estate agents, sellers of high value items such as gold, diamonds, and art - are employed or co-opted by money laundering operations. Money launderers are likely to make increased use of global, around the clock, trading in foreign currencies and derivatives. These provide instantaneous transfer of funds and no audit trail.
The underlying securities involved are susceptible to market manipulation and fraud. Complex insurance policies (with the "wrong" beneficiaries), and the securitization of receivables, leasing contracts, mortgages, and low grade bonds are already used in money laundering schemes. In general, money laundering goes well with risk arbitraging financial instruments.
Trust-based, globe-spanning, money transfer systems based on authentication codes and generations of commercial relationships cemented in honour and blood - are another wave of the future. The Hawala and Chinese networks in Asia, the Black Market Peso Exchange (BMPE) in Latin America, other evolving courier systems in Eastern Europe (mainly in Russia, Ukraine, and Albania) and in Western Europe (mainly in France and Spain).
In conjunction with encrypted e-mail and web anonymizers, these networks are virtually impenetrable. As emigration increases, diasporas established, and transport and telecommunications become ubiquitous, "ethnic banking" along the tradition of the Lombards and the Jews in medieval Europe may become the the preferred venue of money laundering. September 11 may have retarded world civilization in more than one way.
http://www.theconservativevoice.com/article/22965.html
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