U.S. to allocate $29.3 million to Azerbaijan

The U.S. will allocate $29.3 million to Azerbaijan to develop democracy in 2011, the website foreignassistance.gov. reported.

U.S. assistance to Azerbaijan is aimed at promoting democratic reforma, strengthening governmental checks and balances, increasing public participation in state affairs, as well as combating domestic and transnational crime, including money laundering, terrorism financing, corruption, human and drug trafficking. U.S. assistance also helps to expand and diversify the country's economic growth by eliminating critical economic policy and institutional constraints to ensure stability and sustained growth in the sectors of the economy.

Georgia will receive $ 90.1 million in 2011, Armenia - $ 45.2 million, Russia $ 68.7 million, Turkey - $ 5.9 million.

Source: foreignassistance.gov

Azerbaijan actively opposed terrorist organizations - US

Azerbaijan actively opposed terrorist organizations seeking to move people, money, and material through the Caucasus.

The country stepped up efforts and has had some success in reducing the presence of terrorist facilitators and hampering their activities.

It says in Country Reports on Terrorism 2010 report released by the US Department of State on 18 August, News.Az reports.

'Law enforcement bodies continued to pursue terrorist groups and facilitators operating in Azerbaijan. In October 2009, a Baku court sentenced two Lebanese nationals, Ali Muhammad Karaki and Ali Hussein Najmeddin, to prison terms of 15 years each, and sentenced four Azerbaijani accomplices to terms of two to 14 years. The court found that the group was planning attacks on the Israeli Embassy. The investigation revealed that Karaki and Hussein were linked to Hizballah and others in Iran. According to press reports, Karaki and Najmeddin were released in a prisoner exchange with Iran and deported in August 2010, along with 12 Iranian nationals'.

The report says that the Azerbaijani government continued to implement its law on anti-money laundering and counterterrorist financing (AML/CTF) and established a Financial Investigative Unit (FIU). In October, the Central Bank prepared an action plan to bring Azerbaijan's AML/FIU into conformity with the standards of the UN, the Financial Action Task Force (FATF), and other international organizations and conventions. In addition, the Azerbaijan government submitted its plan to the Council of Europe’s Committee of Experts on the Evaluation of Anti-Money Laundering Measures and the Financing of Terrorism (MONEYVAL), the FATF-style regional body. MONEYVAL reviewed Azerbaijan's proposals in December and agreed to withdraw its advisory on non-compliance for Azerbaijan, and removed Azerbaijan from the FATF Watch List. The United States worked with the FIU to improve the legal AML/CTF framework, establish information systems, build capacity for AML/CTF stakeholders, and develop a strategy plan for the FIU. Azerbaijan continued to identify possible terrorism-related funding by distributing lists of suspected terrorist groups and individuals to local banks.

In September, Azerbaijan and Russia signed a border demarcation agreement regarding Azerbaijan's 390-kilometer border with Russia. On November 18, Azerbaijan signed a security cooperation agreement with Caspian Sea littoral states to coordinate law enforcement efforts aimed at smuggling, narcotics trafficking, organized crime, and terrorism.

Source: News.Az

New anti-money laundering trends being discussed in Azerbaijan

First regional conference on Anti- Money Laundering and Countering Financing of Terrorism is taking place in Baku on 17-18 February.

Director of Financial Monitoring Service (FMS) under the Central Bank of Azerbaijan Adishirin Gasimov has reported that the conference is attended by representatives of financial intelligence units of 20 countries and Expert group of Council of Europe on Anti-Money Laundering and Countering of Financing of Terrorism(Moneyval).

"Among the participants there are also executive director of Basel Management Institution, UNO commission on drug and crime fight and about 40 experts. The conference is discussing new challenges of anti- laundering , international cooperation, new trends and typology as well as national informative bases",- A.Gasimov said.

Source: ABC

Azerbaijan renews criteria for suspicious transactions to be monitored

Special indicators for transactions subject to monitoring were renewed to improve the national system in counteracting the law on money or other property obtained in a criminal way and the financing of terrorism in Azerbaijan. This will take into account the proposals for monitoring and international experience, the Financial Monitoring Service under the Central Bank of Azerbaijan (CBA) said on Thursday.

The criteria (specific indicators) of determining the facts that give rise to doubts in connection with money or other property obtained via a criminal way and the financing of terrorism have been prepared on the basis of the provisions of the Financial Monitoring Service. They were approved on December 30, 2011.

Special indicators are used to detect attempts to conduct these operations and inform the Financial Monitoring Service about this.

Along with the approved criteria, the Financial Monitoring Service must determine the specific indicators within the internal control systems taking into account the characteristics of the monitoring agencies

The Financial Monitoring Service was established in accordance with President Ilham Aliyev's decree dated Feb. 23, 2009. The monitoring covers credit institutions, insurance and reinsurance organisations, the professional securities market, the leasing services of credit institutions, money transfers through post offices and other organisations, pawn shops, investment funds, transactions with precious metals, stones and purchase products, non-governmental and religious organisations, lotteries, and providing real estate services.

Source: Trend.az

Azerbaijani parliament adopts draft law on combat with money laundering and terrorism financing

The law envisions creation of a special structure to deal with the financial investigation and examination of the legality of income sources under banking transactions, exceeding AZN 20,000.

The draft law is aimed at creation of the legislative basis for revealing the law offenses, connected with money laundering and terrorism financing.

Speaking before the deputies, deputy chairman of the board of the National bank of Azerbaijan Rufat Aslanly explained that the persons or organizations to undergo monitoring will be considered suspected of the crime.

He said the monitoring by the financial inspection does not mean that they will check the activity of the banks, insurance companies and entrepreneurs on the spots.

"The financial inspection will get information about suspicious operations from the companies, engaged in financial transactions. Considering that the report on the financial operation between the two economic subjects is sent to the financial inspection, it does not mean that one of the establishments is suspected of the crime.

"The structure to deal with financial monitoring, is not empowered to hold inspections of the due economic establishments, interfere with the financial operations. For example, a body receives information about the financial transaction, exceeding AZN 20,000.

At the same time, the body is presented the opinion of the financial operator about his client. It means that the customer has a good reputation as to them. If the financial inspection has other questions, they appeal to the financial operator, not to the client, that holds the transaction", said Aslanly.

The deputies voted for this draft law after discussions.

Source: Today.Az

Anti 'Dirty' Money Laundering Measures in Azerbaijan to be Discussed in Strasburg

The work carried out by Azerbaijan to prevent ‘dirty’ money laundering and financing of terrorism will be discussed in Strasburg.

Te first meeting of the Council of Europe Expert Committee for estimation of money-laundering measures (MONEYVAL) and Azerbaijani Delegation will be held from 12 to 14 November, the Committee reported to Trend News.

A delegation of employees from the Finance, Justice, Interior, National Security and Taxes Ministries, as well as National Bank, State Customs Committee and State Securities Committee will represent Azerbaijan at the meeting.

The Azerbaijani Parliament accepted the Law on struggle against ‘dirty’ money laundering and financing of terrorism at the first and second reading. .

MONEYVAL was established in 1997. The Council of Europe twenty-seven countries are the members of the committee including Azerbaijan. Organization works out reports on works, implemented on the joint estimation system. The first report on Azerbaijan was submitted to the organization at the meeting on 10 December 2003.

At the meeting, which is expected to be held before the plenary meeting of the Committee, the measures that Azerbaijan takes against ‘dirty’ money laundering and financing of terrorism are expected to be discussed. The further cooperation in this sphere with the Council of Europe including the possible cooperation of the Azerbaijani Government on the national and international level and to bring the legislation close to the European and international standards will be considered.

The report on joint estimation of measures that Azerbaijan takes to prevent ‘dirty’ money laundering will be submitted at the regular plenary meeting of MONEYVAL in Strasburg on 8-12 December.

The correspondent can be contacted at: trend@trend.az

Source: Trend News

Azerbaijan to adopt AML Law

The process of adopting the law begun in 2004 on counteraction of legalization of money resources and property received by criminal way and financing of terrorism has all chances to be completed in 2008.

The National Bank of Azerbaijan General Director and Director of Workgroup for Law Elaboration Rufat Aslanli said the Bill has already been adopted in the first reading.

“We expect it to be adopted in further readings straight after resuming parliamentary activity in autumn,” R.Aslanli said.

The law which is the country’s obligation while entering into the European Council introduces system of monitoring under transactions and the operations exceeding the amount of AZN 20,000. The monitoring will cover credit institutions, insurance and reinsurance companies, professional participants of a securities market, leasing services of credit institutions, money transfers through post offices and other organizations, pawnshops, investment funds, transactions with precious metals and stones and purchase of precious products, non-governmental and religious organizations, organizers of lotteries rendering real-estate sale-purchase services (realtors) as well as lawyers, auditors, real estate deals, client assets, securities and property, client bank and depot accounts. A special state body will be established for the monitoring.

Elaboration and international expertise of the Law was completed in May 2005.

Source: ABC.AZ

US State Department: Azerbaijan has done significant work toward combating terrorism

APA- It has closed organizations that were suspected of supporting terrorist groups and arrested at least 39 persons from three separate terrorist-associated groups, on terrorism-related charges”, reads in the annual report of US State Department on the anti-terrorism activities in the world countries in 2007.

“Since August 2003, Azerbaijan has supported peacekeeping operations in Iraq with an infantry company of approximately 150 soldiers stationed at the Haditha Dam. A platoon of Azerbaijani soldiers has worked with the Turkish peacekeeping contingent in Afghanistan since November 2002”.

The State Department emphasized that while Azerbaijan has taken steps to combat terrorist financing and identify possible terrorist-related funding by distributing lists of suspected terrorist groups and individuals to local banks, comprehensive legislation to counter terrorist financing has not yet passed parliament. “In December 2006, an inter-ministerial experts group responsible for drafting anti-money laundering and counterterrorist finance legislation through the President’s office provided its most recent draft to the U.S. Department of Justice and the Council of Europe; the Department of Justice provided comments on the law and discussed it with Azerbaijani government officials. The government has not yet presented the draft law to parliament”. Successful operations conducted by the Azerbaijani law-enforcement bodies for combating terrorism have also been focused in the report.

“In February, Azerbaijani authorities arrested a group of 15 Azerbaijani citizens in Baku who called themselves the Northern Mahdi Army. The group was charged with having ties to Iran’s Islamic Revolutionary Guards Corps (IRGC). In October, the group went before a closed trial. According to the Azerbaijani Ministry of National Security, one of the group members had met an IRGC officer in Iran, and was offered money to fight against the United States, Israel and other Western countries.

During security sweeps in late October and early November, a group of twelve Azerbaijanis, reportedly led by an ethnic Arab named Abu Jafar, were arrested in Sumgayit, Azerbaijan on terrorism-related charges”.

“Separately, in November, 11 Azerbaijani citizens were arrested over a number of days in connection with a late October threat against the U.S. Embassy in Baku, which resulted in the embassy working at limited staffing for two days”, reads in the report.

http://www.amlosphere.com/asia/aml/us-state-department-azerbaijan-has-done-significant-work-toward-combating-terrorism.html

MONEYVAL AML warning for Azerbaijan

The Cyprus Securities & Exchange Commission has forward a public statement of the Committee of Experts of the Council of Europe on the Evaluation of Anti-Money Laundering and the Financing of Terrorism (MONEYVAL), regarding the deficiencies in the anti-money laundering and combating the financing of terrorism regime in Azerbaijan.

Therefore, Cyprus Investment Firms have been requested to pay special attention by applying enhanced due diligence to transactions with persons from Azerbaijan.

Source: Financial Mirror

UK: HM Treasury warns businesses of serious threats posed to the international financial system

This notice constitutes advice issued by HM Treasury about serious threats posed to the integrity of the international financial system. The Money Laundering Regulations 2007 require firms to put in place policies, procedures or systems in order to prevent money laundering or terrorist financing. Regulated businesses are also required to apply enhanced customer due diligence and enhanced ongoing monitoring on a risk-sensitive basis in certain defined situations and in "any other situation which by its nature can present a higher risk of money laundering or terrorist financing".

On 25th February 2009 the Financial Action Task Force (FATF) issued a statement drawing attention to deficiencies in several jurisdictions of concern. The UK fully supports the work of the FATF on these matters and HM Treasury agrees with the FATF's assessments.

The UK additionally draws attention to, and supports, the public statement of MONEYVAL (a FATF style regional body under the auspices of the Council of Europe) of 12 December 2008 in respect of Azerbaijan.

The substance of the FATF statement is attached as an Annex.

Iran
The FATF announced that it remains concerned by Iran's failure to meaningfully address the deficiencies in its anti-money laundering and combating terrorist financing (AML/CTF) regime, particularly in respect of terrorist financing and suspicious activity reporting.

The FATF has called on its members to consider effective countermeasures to protect their financial sectors from risks emanating from Iran, and to protect against the use of correspondent banking relationships to bypass or evade counter-measures and risk mitigation practices.

All UK businesses regulated under the Money Laundering Regulations 2007, whether financial institutions or other regulated persons should treat transactions associated with Iran as situations that by their nature can present a higher risk of money laundering or terrorist financing, and which therefore require increased scrutiny, enhanced due diligence, and ongoing monitoring, including in the case of correspondent relationships.

All other persons authorised by the Financial Services Authority should also take this advice into account in respect of their systems and controls to counter financial crime, and take appropriate actions to minimise the associated risks.

In the light of the call for countermeasures the UK is, in addition, considering what further action is required.

Uzbekistan
The FATF has also drawn attention to the continuing AML/CTF deficiencies in Uzbekistan.

The attention of UK financial institutions and other persons regulated for money-laundering purposes is therefore drawn to the FATF statement in respect of this jurisdiction, and the risk that it continues to present. They should take this advice into account in respect of their systems and controls to counter financial crime, and take appropriate actions to minimise the associated risks.

Turkmenistan, Pakistan, and Sao Tome and Principe
The FATF has also drawn attention to the continuing AML/CTF deficiencies in Turkmenistan, Pakistan, and Sao Tome and Principe.

The attention of UK financial institutions regulated for money laundering purposes is therefore drawn to the FATF statements in respect of those jurisdictions, and the risks that they continue to present. They should take this advice into account in respect of their systems and controls to counter financial crime, and take appropriate actions to minimise the associated risks.

The northern part of Cyprus
The northern part of Cyprus is no longer highlighted as a jurisdiction of concern, following improvements made to its AML/CTF regime.

Azerbaijan
MONEYVAL drew attention to deficiencies in the AML/CTF regime in Azerbaijan in December 2008.

The attention of UK financial institutions regulated for money laundering purposes is therefore drawn to the MONEYVAL statement in respect of this jurisdiction, and the risks that it continues to present.

This advice is effective immediately.

Source: eGov

Azerbaijan approves Regulation on Financial Monitoring Service under Central Bank

By his decree from 16 July of the year President Ilham Aliyev has endorsed the Regulation on the Financial Monitoring Service under the Central Bank that is the main point in realization of the Law on counteraction to legalization of money and property received by criminal way and terrorism financing.

The Presidential Administration’s press service informs that the Central Bank was charged with approving Agency’s structure and staff for 15 days and solving issues following the decree. The Cabinet was given a month to make the proposals for bringing the appropriate legislative acts in compliance with the decree, make together with other bodies of executive power the relevant amendments to the standard and legal acts and solve the matter of material and technical maintenance of the Service.

Earlier Rufat Aslanli, the chairperson of the State Securities Committee and the head of the law-maker group, said that after adoption and commencement of the Draft Law, Moneyval (the Council of Europe Committee of Experts on the Evaluation of Anti-Money Laundering Measures) published a statement which covered positive results and achievements of Azerbaijan.

A Moneyval’s plenary session also made a decision to empower its office with the right to halt monitoring of Azerbaijan in case of the latter implements all decisions covered by presidential decree on law application. Among these decisions are approval of the Charter of Financial Monitoring Body under the Central Bank of Azerbaijan, adoption of relevant amendments to the Administrative and Criminal Codes.

The plenary session also decided to transfer to its Bureau the right to stop the monitoring of Azerbaijan in case the latter implements all decisions covered by the presidential decree on law application, in particular if Azerbaijan approves the Charter of the Financial Monitoring Body and passes draft amendments and additions to the Administrative and Criminal Codes.

Earlier this year Financial Action Task Force (FATF) called the member states and other countries to be extremely careful in deals with persons and financial organizations residing or located in Azerbaijan.

Moneyval’s next session will be held at the end of 2009 and Azerbaijan will have a chance for full removal of monitoring on simplified system.

On 24 February 2009, President of Azerbaijan Ilham Aliyev signed the Draft Law on counteraction to legalization of the money and property received by criminal way and terrorism financing adopted by the Parliament on February 10. The decree says of establishment of Financial Monitoring Service under the National Bank and gives a month to the NB to develop and submit the Regulation on the Service.

In its public statement passed on 12 December 2008 the FATF appealed financial institutions of other countries to be extremely careful in deals with Azerbaijan and carry out due check of clients to remove risk of money laundering/terrorism financing. To the Expert Group appeal it was indicated to re-consider the Bill on Counteraction to ML/TF passed in the second reading in Azerbaijan as it fails to conform to key international standards to the large extent and adopt immediately complex legislation complying with the requirements.

Rosfinmonitoring’s notification can aggravate realization of financial operations between Russia and Azerbaijan.

In its evaluation Moneval also pointed out that the country fails to fulfill structural, legislative and institutional requirements when certain type of institute is lacking in the country.

Out of the 40 FATF standards there were recognized Azerbaijan’s non-conformity in fight against breaches on money laundering, audit of clients, politically persecuted persons, new technologies and face-to-face business, non-standard deals, reporting on suspicious deals, internal control, audit, sanctions, foreign branches and subsidiaries, management and relations with clients, lack of a body on FIU, on statistics, freezing and confiscation of terrorist funds, non-profit organizations.

Source: ABC.AZ

Money-laundering ring broken in Russia

A $9 billion money-laundering operation partly run by several Russian bank employees has been broken up by police, the Russian Interior Ministry said.

Four Azerbaijani nationals were detained by police, accused of being involved in the operation laundering about $3 billion a year since 2008, RIA Novosti said Friday.

The currency was suspected to have been generated from illegal business operations, transferred to foreign outlets and smuggled back into Russia, the news agency said.

"It was established that the criminal scheme involved employees of Russian banks and other commercial structures: money was transferred to foreign organizations, cashed, and then smuggled back into Russia," a statement said.

The ministry said fake companies were registered in connection with the scheme in Lithuania, the United Arab Emirates, Azerbaijan and Cyprus.

Source: UPI

UKs Statement On Overseas Jurisdiction In Money Laundering Controls

This notice constitutes advice issued by HM Treasury about risks posed by unsatisfactory money laundering controls in a number of jurisdictions.

The Money Laundering Regulations 2007 require firms to put in place policies, procedures or systems in order to prevent money laundering or terrorist financing.

Regulated businesses are also required to apply enhanced customer due diligence and enhanced ongoing monitoring on a risk-sensitive basis in certain defined situations and in “any other situation which by its nature can present a higher risk of money laundering or terrorist financing”.

On 16th October 2009 the Financial Action Task Force (FATF) issued a further statement drawing attention to deficiencies in several jurisdictions of concern. The UK fully supports the work of the FATF on these matters and HM Treasury agrees with the FATF assessments.

The UK additionally draws attention to, and supports, the public statements of MONEYVAL (a FATF style regional body under the auspices of the Council of Europe) in respect of Azerbaijan in December 2008, March 2009 and September 2009.

This advice is effective immediately.

The substance of the FATF statement is attached as an Annex.

Iran

The FATF is concerned about Iran’s lack of engagement with the FATF and its failure to meaningfully address the ongoing and substantial deficiencies in its AML/CFT regime.

The FATF has called on its members to apply effective countermeasures to protect their financial sectors from risks emanating from Iran, and to protect against the use of correspondent banking relationships to bypass or evade counter-measures and risk mitigation practices. The FATF has further warned that it will call upon its members and other jurisdictions to strengthen counter-measures at it’s next meeting in February 2010 if Iran fails to take concrete steps to improve the deficiencies in its AML/CFT regime.

All UK businesses regulated under the Money Laundering Regulations 2007 whether financial institutions or other regulated persons should treat transactions associated with Iran as situations that by their nature can present a higher risk of money laundering or terrorist financing, and which therefore require increased scrutiny, enhanced due diligence, and ongoing monitoring, particularly where correspondent relationships are involved, which have been highlighted as a particular risk.

All other persons authorised by the Financial Services Authority should also take this advice into account in respect of their systems and controls to counter financial crime, and take appropriate actions to minimise the associated risks.

Further to the call for countermeasures by the FATF, on the 12 October 2009, HM Treasury issued a direction under the Counter Terrorism Act to the UK financial sector to cease all business relationships and transactions with Bank Mellat and Islamic Republic of Iran Shipping Lines (IRISL). For further information on these directions, please see the HM Treasury website: http://www.hm-treasury.gov.uk/fin_crime_policy.htm

Pakistan

The FATF has expressed its concern at the approaching expiry of Pakistan’s Anti-Money Laundering Ordinance, and has urged Pakistan to implement a permanent AML/CFT framework before the Ordinance expires. The FATF also noted that it would consider taking action to protect the financial system from money laundering and terrorist financing risk emanating from Pakistan in February 2010 if concrete progress has not been made by that date.

UK financial institutions regulated for money laundering purposes should pay attention to the latest FATF statement in respect of Pakistan and the risks it presents. Financial institutions should take this advice into account in respect of their systems and controls to counter financial crime, and take appropriate actions to minimise the associated risks.

Uzbekistan, Turkmenistan and São Tomé and Príncipe

The FATF has also drawn attention to the continuing AML/CTF deficiencies in Uzbekistan, Turkmenistan, and São Tomé and Príncipe.

The attention of UK financial institutions regulated for money laundering purposes is therefore drawn to the FATF statements in respect of those jurisdictions, and the risks that they continue to present. They should take this advice into account in respect of their systems and controls to counter financial crime, and take appropriate actions to minimise the associated risks.

Azerbaijan

MONEYVAL drew attention to deficiencies in the AML/CTF regime in Azerbaijan through statements in December 2008, March 2009 and September 2009.

The attention of UK financial institutions regulated for money laundering purposes is therefore drawn to the latest MONEYVAL statement in respect of this jurisdiction, and the risks that it continues to present.

Source: The Gov Monitor

ANTI-MONEY LAUNDERING GATHERING IN STRASBOURG

From 21 to 23 February the Council of Europe will be hosting the first joint meeting of the Financial Action Task Force (FATF) and the Council of Europe Committee of Experts on the Evaluation of Anti-Money Laundering Measures (MONEYVAL).

With the aim of strengthening international co-operation in the fight against money laundering and terrorist financing, the approximately 400 participants will study the FATF's mutual evaluation report on Turkey, MONEYVAL's third-round mutual evaluation report on Georgia and a progress report submitted by Cyprus. Reports from Armenia and Azerbaijan will be considered also by MONEYVAL.

Other items on the agenda are abuse of Value Added Tax systems for money laundering and money-laundering in South America.

Terry Davis, Secretary General of the Council of Europe, will open the meeting at 9 a.m. on Wednesday 21 February (only this part of the meeting is open to the press).

FATF President, Frank Swedlove, and MONEYVAL Chairman, Vasil Kirov, as well as the acting Director General of Legal Affairs of the Council of Europe, Philippe Boillat, will hold a media briefing at 1 p.m. on Friday 23 February in Room 1 of the Palais de l’Europe (2nd floor).

Twenty-seven of the 46 member states of the Council of Europe are currently members of the MONEYVAL Committee . The FATF has 33 members.

http://www.armtown.com/news/en/a1p/20070214/45537