Kenya's Parliament finally passed the Proceeds of Crime and Anti-Money Laundering Bill in December. But while the passing of the bill is viewed as a highlight of the Tenth Parliament, many fear it may just be a gimmick by the government to appease international partners.
George Kegoro, the executive director of International Commission of Jurists - Kenya Chapter, says while the legislation is good, he doubts there is political will to completely stamp out money laundering in Kenya.
"The existence of the legislation is not sufficient to deter the vice neither are the stiff penalties that are recommended in the bill," he says. "There is need for genuine support from the government to enact this law. We need a good set of people to be put in place to interpret the legislation."
Kegoro, whose organisation undertakes advocacy and policy work aimed at strengthening the role of lawyers and judges in protecting human rights and the rule of law, argues that while the bill was government-sponsored, Kenya’s track-record on corruption is poor and he doubts the genuineness of the political class.
It is the fourth attempt since 2004 to pass a bill to prevent the concealment of large profits from drug trafficking and other organised crime, and even this time around it faced resistance from members of parliament who believed the bill was a sly back-door re-introduction of an Anti-Terrorism Bill which had been quashed.
When the bill was tabled in November, an assistant minister in defiance of his own government, strongly opposed the tenets of the Bill. The assistant minister for public service, Aden Sugow, opposed the Bill saying it was an attack on the Muslim community. He argued implementing the Bill would be bowing to the interests of external interests and said that Kenya currently has adequate laws in place to deter money laundering.
While supporting the bill, defence minister Yusuf Hajji warned of a general feeling among the Muslim community that the legislation was targeting them. The Bill went forward after assurances from Prime Minister Raila Odinga that the government had no such intentions.
Once signed by the president, the law will establish a Financial Reporting Centre to assist in the identification of the proceeds of crime. An Asset Recovery Agency will be charged with tracing and recovering ill-gotten assets.
According to Job Ogonda executive director of international corruption watchdogs Transparency International, this would mean millions of dollars stashed in off-shore accounts swindled from Kenya could be recovered.
But Ogonda doubts the passage of new legislation will improve Kenya’s standing as a corrupt state internationally.
"At the moment it is embarrassing to be a Kenyan. Nigeria is improving with regards to corruption because they have shown tangible commitment of doing something about graft. However, the same cannot be said for Kenya," he says.
"We have previously had good pieces of legislation which would have helped fight graft, however, nothing has been done. How many ministers or former ministers have ever gone to prison because of corruption?" Ogonda wonders.
Ogonda is referring to anti-corruption legislation such as the Public Procurement and the Public Officers Ethics Act which require all public office holders to declare their wealth and origin of the same: this older legislation has had no noticeable effect.
Kenya’s record internationally as a corrupt state has for many years been bad and in the bribery and corruption index released by Transparency International, the country has kept the company of states such as Nigeria, Russia and Zimbabwe. Currently, Kenya is position 147 out of 180 on the global index of corruption.
Indeed the passing of the anti-money laundering bill comes in the wake of the release of a U.S. State Department report saying 93 million dollars of earnings from drug trafficking are laundered in the country’s financial system annually.
Another equally damning report by a UK firm, Kroll Associates, hired by the Kenyan government to track wealth acquired corruptly, revealed an estimated $1.7 billion is currently stashed in off-shore accounts. While the results of this 2004 report have remained confidential, the document was leaked: no action has been taken against any of the prominent figures named in its 110 pages.
But all the right noises were made when the bill was moved in Parliament by deputy Prime Minister Uhuru Kenyatta, who said that in view of the magnitude of the problem to the economy, the debate should focus on the quality of the legislation to ensure it was stringent enough.
Seconding the bill, Raila said, "The country risks becoming a pariah state unless the legislation is passed. We have suffered from the effects of money laundering especially in the property sector whose value has been skyrocketing due to the money being brought from the acts of piracy off the coast of Somalia".
A boom in property prices in Nairobi is preventing a majority of Kenyans from buying real estate, and in some cases even pricing locals out of the rental market. Media reports are linking the boom with profits from Somali pirates who seized numerous vessels during 2009, extracting handsome fees from their owners before releasing ships and crew members. In certain Nairobi neighbourhoods, Somalis are willing and able to pay rent up front for periods of even up to two years.
Ogonda states that for many years, Kenya has been a hub of money laundering with illegally acquired cash from Europe, South Africa, South America, Democratic Republic of Congo, Sudan, Rwanda, Burundi, Uganda and Tanzania finding its way into local financial markets.
"Due to our porous borders and poor implementation of legislation, people have simply walked in with huge amounts of cash, hired a lawyer to front for them who in turn invest the cash, especially in property," Ogonda says.
He says despite moves to assure the independence of the new watchdog agencies' leadership, and fresh monitoring requirements for the banking system, the version of the bill which is now awaiting presidential assent does not demand greater accountability from lawyers whose lawyer-client privileges remain intact.
Kegoro notes that the prescribed penalties are fairly high - jail terms of two to five years, with fines of up to $65,000 for individuals, and corporate penalties set as high as $330,000 or the value of the property. But, he argues, it is not the severity of the penalty that will make people fear it. It is the certainty of being caught, hence the need for genuine political will to implement the law.
Ogonda is in agreement. "Application of the bill is what will be the determining factor. The structure of governance has to support the law and if it remains the same the legislation can exist and nothing will change."
By Susan Anyangu-Amu
Source: IPS
Showing posts with label South Africa. Show all posts
Showing posts with label South Africa. Show all posts
on Wednesday, June 6, 2012
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on Tuesday, May 29, 2012
New leader of the governing ANC party in South Africa, Jacob Zuma, has been charged with corruption.
Prosecutors have served papers ordering him to stand trial on counts of corruption, fraud, money laundering and racketeering.
Mr Zuma stands accused of taking a bribe from a French arms company during his time as vice president.
The documents from the National Prosecuting Authority (NPA) were not unexpected.
The NPA's specialist anti-corruption unit, known as the Scorpions, has been investigating allegations of corruption for years, and last month they won an appeal court battle to get access to critical documents for their inquiries.
Mr Zuma and his supporters have always denied any wrongdoing, and they have insisted the allegations of corruption are all part of a grand conspiracy to destroy his political career.
Mr Zuma's lawyer Michael Hulley says the trial is expected to start in August next year and that some of the allegations are old.
"Some of the actual charges which have been signed in a previous indictment have been repeated, and others have been added," he said.
"Broadly speaking, they currently range from racketeering, to money laundering, to corruption, as well as fraud."
-BBC/ABC
http://www.abc.net.au/news/stories/2007/12/29/2128629.htm?section=world
Prosecutors have served papers ordering him to stand trial on counts of corruption, fraud, money laundering and racketeering.
Mr Zuma stands accused of taking a bribe from a French arms company during his time as vice president.
The documents from the National Prosecuting Authority (NPA) were not unexpected.
The NPA's specialist anti-corruption unit, known as the Scorpions, has been investigating allegations of corruption for years, and last month they won an appeal court battle to get access to critical documents for their inquiries.
Mr Zuma and his supporters have always denied any wrongdoing, and they have insisted the allegations of corruption are all part of a grand conspiracy to destroy his political career.
Mr Zuma's lawyer Michael Hulley says the trial is expected to start in August next year and that some of the allegations are old.
"Some of the actual charges which have been signed in a previous indictment have been repeated, and others have been added," he said.
"Broadly speaking, they currently range from racketeering, to money laundering, to corruption, as well as fraud."
-BBC/ABC
http://www.abc.net.au/news/stories/2007/12/29/2128629.htm?section=world
on Monday, May 21, 2012
Sri Lanka: International Conference on Countering Terrorism draws international terrorism experts to Colombo
20th October 2007
The three-day International Conference on Countering Terrorism is now on in Colombo on the theme 'Terrorism: A Challenge to Democratically Elected Governments.' The Conference, brought together renowned terrorism experts, including from the academia and the media, from 23 countries including Australia, China, Czech Republic, France, Germany, India, Indonesia, Russia, Singapore, South Africa, the United States and Vietnam. It was also widely attended by the Diplomatic Community .
Delivering the Inaugural Address, Foreign Minister Rohitha Bogollagama, highlighted that "Sri Lanka had been a foot soldier in the battle against terrorism over a long period of time and notwithstanding some impediments and setbacks, can in several aspects count itself as having been a success story in the battle against terrorism." Sri Lanka's refusal to compromise or condone terrorism while constantly seeking to resolve the conflict through political means, to persuade other states to proscribe the LTTE, prevent money flows and apprehend those conniving with terrorists, has been significant. Successive governments and the people of Sri Lanka have also shown considerable resilience in the face of terror, whilst also ensuring that economic growth was not compromised. The Minister hoped that the deliberations of this Conference would, among other matters focus on the need for states to go beyond merely adopting conventions, to convert these into tangible action by developing enabling legislation and taking concrete action against those including terrorist front organizations operating from their soil. Noting that a bulk of maritime traffic passes through the Indian Ocean region and that in recent times many acts of terrorism had taken place in these waters, the Minister emphasized the urgent necessity to develop robust modalities to arrest the growing threat that faces Indian Ocean states from terrorists.
The former Director of the European Center for the Study of Conflicts in France, and one of the earliest writers in the field of terrorism, Dr. Gerard Chaliand traced the evolution of terrorism over the years. Referring to the LTTE, he said "the independence they ask cannot be granted and should not be granted, not only because no State is willing to accept such a blow to its sovereignity but also because, like the Shining Path or the Khmer Rouges, the LTTE under the leadership of V. Prabhakaran is a totalitarian movement, which has transformed its groups into a killing machine." He said "the most important thing about the LTTE is that it is a totalitarian movement fighting in a country which is democratic." He said the "LTTE has brutally eliminated all other parties or groups willing to represent the Tamils". "An absolutely intolerant sect, no peace seems possible with V. Prabhakaran as we have seen from the peace process of 2002-2005, which was but a tactical truce", Dr. Chaliand added.
Secretary of Foreign Affairs, Dr. Palitha Kohona delivering the vote-of-thanks repeated the unprecedented challenge Sri Lanka faces in combating terrorism and Sri Lanka. He said the world had focused on international terrorism only after 9/11 but terrorism had affected countries long before then. He emphasized that "the international rule of law against terrorism is being strong themed each year," adding that "there are 13 UN Conventions addressing different dimensions of the global terrorist threat and a comprehensive convention is being negotiated." The Foreign Secretary pointed out that "terrorism will never be eradicated solely by cooperation among law enforcement officials. It requires a concerted political effort and policy coordination among countries. Further it also requires an ability to understand and minimize the motivation and impetus that inspire terrorist acts."
Renowned Chairman of the French Anti-Terrorist Judges, Judge Jean Louis Bruguiere, who was the Guest of Honour of the Conference, and addressing the first panel of the day focused on the international responses to terrorism, traced the manner in which international efforts at responding to terrorism have evolved over the years, stating that if the fight against terrorism is an inescapable requirement, "we owe it to ourselves to reinforce our international cooperation at every level, notably by adopting multilateral or bilateral conventions in the field of judicial cooperation as well as extradition." He said the French Government considers "that an organization like the LTTE is a terrorist organization like any other and that its activities even in the area of logistics, have to be repressed with the same vigour as for terrorist networks operating on our [French] soil and threatening us directly" and that on this basis "that in April this year the French Government had dismantled a vast network of Tamil militants who actively supported the LTTE, notably at the financial level."
This session, which was chaired by the Dean of the Faculty of Arts of the University of Colombo, Prof. Amal Jayawardena,while the discussants were the Executive Director of the Regional Centre for Strategic Studies, Dr. Rifaat Hussain and the Senior Terrorism Prevention Officer of the United Nations Office on Drugs and Crime, Vienna, Dr. Ms. Irka Kuleshnyk.
Addressing the panel on regional responses to terrorism, former Commander of the Indian Army, Gen. V. P. Malik emphasized the need to combat and defeat terrorism in all its manifestations. He said "terrorist activities anywhere will stop only when their fuel runs out." Gen. Malik who traced the important steps taken to counter terrorism in South Asia, emphasized the need for a regional strategy and cooperation, but essentially local operatives and doctrines.
Former Secretary General of SAARC, Ambassador Nihal Rodrigo, chaired this session, while the discussants comprised the Associate Research Fellow of the China Institute of International Studies, Prof. Zhang Lijun, the Deputy Director of the Russian Foreign Ministry, Mr. Vladimir Titokerni as well as the Pro-Chancellor and Director of the School of Science and Forensic Science, National Law University Rajastan, India, Prof. P. Chandra Sekharan.
The third thematic session focused on the domestic dimensions of terrorism where the head of the International Centre for Political Violence and Terrorism Research in Singapore, Dr. Rohan Gunaratna, who was the principal speaker, who joining the deliberations on a video link, highlighted the recent successes of the security forces in combating LTTE terrorism. He noted that within the year the Sri Lanka Navy destroyed eight merchant vessels. In order to defeat the LTTE, Dr. Gunaratna articulated the need for strengthening and building capacity in the intelligence field, with a high degree of professionalism, and also stressed the necessity for special forces and elite units that could target the leadership of the LTTE.
Former Inspector General of Police, Mr. Chandra Fernando chaired the discussion at which intervention were made by Deputy Solicitor General, Mr. Dappula de Livera and Prof. Karunaratne Hangawatte of the University of Nevada.
The final panel discussion of the day focused of the critical area of combating terrorist financing, where the Founder and CEO of World-Check, Mr. David Leppan spoke extensively on the manner in which terror groups collect funds and their illegal activities.
Researcher of the Centre for Policing, Intelligence and Counter Terrorism of the Macquarie University of Australia, Mr. Shanaka Jayasekera the co-speaker at this session noted that the LTTE's supply chain capability has been significantly disrupted, estimated at between 65% to 70%. This would result in the need for the LTTE to aggressively campaign for fund raising activities in the 12 top level resource mobilization countries. In order to maintain the advantage the Government has achieved, it is imperative that the fund-raising be curbed with international cooperation in the next few months. Therefore it is suggested that a contact group be established as a prelude to the commencement of a political process."
The Deputy Governor of the Central Bank, Dr. Ms. Ranee Jayamaha chaired the sessions, at which the discussants were Mrs. Joan De Zilva Moonesinghe formerly of the Financial Investigation Unit and the Advisor of the Financial Investigation Unit of the Central Bank, Mr. Eric Stonecipher.
Ministry of Foreign Affairs
Colombo
20 October 2007
20th October 2007
The three-day International Conference on Countering Terrorism is now on in Colombo on the theme 'Terrorism: A Challenge to Democratically Elected Governments.' The Conference, brought together renowned terrorism experts, including from the academia and the media, from 23 countries including Australia, China, Czech Republic, France, Germany, India, Indonesia, Russia, Singapore, South Africa, the United States and Vietnam. It was also widely attended by the Diplomatic Community .
Delivering the Inaugural Address, Foreign Minister Rohitha Bogollagama, highlighted that "Sri Lanka had been a foot soldier in the battle against terrorism over a long period of time and notwithstanding some impediments and setbacks, can in several aspects count itself as having been a success story in the battle against terrorism." Sri Lanka's refusal to compromise or condone terrorism while constantly seeking to resolve the conflict through political means, to persuade other states to proscribe the LTTE, prevent money flows and apprehend those conniving with terrorists, has been significant. Successive governments and the people of Sri Lanka have also shown considerable resilience in the face of terror, whilst also ensuring that economic growth was not compromised. The Minister hoped that the deliberations of this Conference would, among other matters focus on the need for states to go beyond merely adopting conventions, to convert these into tangible action by developing enabling legislation and taking concrete action against those including terrorist front organizations operating from their soil. Noting that a bulk of maritime traffic passes through the Indian Ocean region and that in recent times many acts of terrorism had taken place in these waters, the Minister emphasized the urgent necessity to develop robust modalities to arrest the growing threat that faces Indian Ocean states from terrorists.
The former Director of the European Center for the Study of Conflicts in France, and one of the earliest writers in the field of terrorism, Dr. Gerard Chaliand traced the evolution of terrorism over the years. Referring to the LTTE, he said "the independence they ask cannot be granted and should not be granted, not only because no State is willing to accept such a blow to its sovereignity but also because, like the Shining Path or the Khmer Rouges, the LTTE under the leadership of V. Prabhakaran is a totalitarian movement, which has transformed its groups into a killing machine." He said "the most important thing about the LTTE is that it is a totalitarian movement fighting in a country which is democratic." He said the "LTTE has brutally eliminated all other parties or groups willing to represent the Tamils". "An absolutely intolerant sect, no peace seems possible with V. Prabhakaran as we have seen from the peace process of 2002-2005, which was but a tactical truce", Dr. Chaliand added.
Secretary of Foreign Affairs, Dr. Palitha Kohona delivering the vote-of-thanks repeated the unprecedented challenge Sri Lanka faces in combating terrorism and Sri Lanka. He said the world had focused on international terrorism only after 9/11 but terrorism had affected countries long before then. He emphasized that "the international rule of law against terrorism is being strong themed each year," adding that "there are 13 UN Conventions addressing different dimensions of the global terrorist threat and a comprehensive convention is being negotiated." The Foreign Secretary pointed out that "terrorism will never be eradicated solely by cooperation among law enforcement officials. It requires a concerted political effort and policy coordination among countries. Further it also requires an ability to understand and minimize the motivation and impetus that inspire terrorist acts."
Renowned Chairman of the French Anti-Terrorist Judges, Judge Jean Louis Bruguiere, who was the Guest of Honour of the Conference, and addressing the first panel of the day focused on the international responses to terrorism, traced the manner in which international efforts at responding to terrorism have evolved over the years, stating that if the fight against terrorism is an inescapable requirement, "we owe it to ourselves to reinforce our international cooperation at every level, notably by adopting multilateral or bilateral conventions in the field of judicial cooperation as well as extradition." He said the French Government considers "that an organization like the LTTE is a terrorist organization like any other and that its activities even in the area of logistics, have to be repressed with the same vigour as for terrorist networks operating on our [French] soil and threatening us directly" and that on this basis "that in April this year the French Government had dismantled a vast network of Tamil militants who actively supported the LTTE, notably at the financial level."
This session, which was chaired by the Dean of the Faculty of Arts of the University of Colombo, Prof. Amal Jayawardena,while the discussants were the Executive Director of the Regional Centre for Strategic Studies, Dr. Rifaat Hussain and the Senior Terrorism Prevention Officer of the United Nations Office on Drugs and Crime, Vienna, Dr. Ms. Irka Kuleshnyk.
Addressing the panel on regional responses to terrorism, former Commander of the Indian Army, Gen. V. P. Malik emphasized the need to combat and defeat terrorism in all its manifestations. He said "terrorist activities anywhere will stop only when their fuel runs out." Gen. Malik who traced the important steps taken to counter terrorism in South Asia, emphasized the need for a regional strategy and cooperation, but essentially local operatives and doctrines.
Former Secretary General of SAARC, Ambassador Nihal Rodrigo, chaired this session, while the discussants comprised the Associate Research Fellow of the China Institute of International Studies, Prof. Zhang Lijun, the Deputy Director of the Russian Foreign Ministry, Mr. Vladimir Titokerni as well as the Pro-Chancellor and Director of the School of Science and Forensic Science, National Law University Rajastan, India, Prof. P. Chandra Sekharan.
The third thematic session focused on the domestic dimensions of terrorism where the head of the International Centre for Political Violence and Terrorism Research in Singapore, Dr. Rohan Gunaratna, who was the principal speaker, who joining the deliberations on a video link, highlighted the recent successes of the security forces in combating LTTE terrorism. He noted that within the year the Sri Lanka Navy destroyed eight merchant vessels. In order to defeat the LTTE, Dr. Gunaratna articulated the need for strengthening and building capacity in the intelligence field, with a high degree of professionalism, and also stressed the necessity for special forces and elite units that could target the leadership of the LTTE.
Former Inspector General of Police, Mr. Chandra Fernando chaired the discussion at which intervention were made by Deputy Solicitor General, Mr. Dappula de Livera and Prof. Karunaratne Hangawatte of the University of Nevada.
The final panel discussion of the day focused of the critical area of combating terrorist financing, where the Founder and CEO of World-Check, Mr. David Leppan spoke extensively on the manner in which terror groups collect funds and their illegal activities.
Researcher of the Centre for Policing, Intelligence and Counter Terrorism of the Macquarie University of Australia, Mr. Shanaka Jayasekera the co-speaker at this session noted that the LTTE's supply chain capability has been significantly disrupted, estimated at between 65% to 70%. This would result in the need for the LTTE to aggressively campaign for fund raising activities in the 12 top level resource mobilization countries. In order to maintain the advantage the Government has achieved, it is imperative that the fund-raising be curbed with international cooperation in the next few months. Therefore it is suggested that a contact group be established as a prelude to the commencement of a political process."
The Deputy Governor of the Central Bank, Dr. Ms. Ranee Jayamaha chaired the sessions, at which the discussants were Mrs. Joan De Zilva Moonesinghe formerly of the Financial Investigation Unit and the Advisor of the Financial Investigation Unit of the Central Bank, Mr. Eric Stonecipher.
Ministry of Foreign Affairs
Colombo
20 October 2007
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on Sunday, May 13, 2012
The Financial Intelligence Centre (FIC) will probably have to impose much more stringent regulations to combat money laundering and terrorist financing than the customer identification, record keeping and reporting of suspicious transactions it currently requires, says its director, Murray Michell.
Controversial new legislation designed to tighten up the enforcement of existing rules is simply a pre-lude to a more thorough review of the way the centre and its enabling legislation work, he told the Mail & Guardian this week, and measures that consumers and banks already chafe at may get much more demanding.
“We need more efficient customer identification, and in some jurisdictions there is customer due-diligence. In other words, not just who your client is, but what transactions has he done in the past? Has the pattern changed? That is a lot more onerous than what we currently have, but that is where we ultimately have to go,” he said.
That review process, which Michell estimates will take another three years, is likely to further irk critics of a Bill proposing amendments to the Financial Intelligence Centre Act (Fica) that is working its way through Parliament.
Key features of the new legislation include an administrative track for enforcement of Fica rules alongside the existing criminal avenue, substantially increased fines for non-compliance, and a new enforcement role for the centre. The FIC will now act as a supervisor for those sectors that are covered by legislation but have no supervisory body, such as the motor industry. More controversially, it also wants the power to step in where it feels existing supervisory bodies, like the Financial Services Board, have not done enough.
Critics, principally in the legal and accounting professions, argue that the changes would turn the centre into an unaccountable super-regulator, and push already high compliance costs.
But Michell insists that the legislation simply plugs gaps in the original Act. “[Banks and other institutions covered by the Act] don’t have to do anything new. What the Bill does do is increase the risk of non-compliance.
“Supervisory bodies such as the Financial Services Board were given responsibility by the original Act to enforce its provisions, but no clear legal mandate. They are now given that mandate,” he said.
“In some cases, like Fidentia, there was deliberate non-compliance so they could move funds around. That is criminal. But 99% of non-compliance is administrative in nature. You don’t want to go to court because an estate agent hasn’t kept their files properly.”
Consultation, appeals processes, and the right of recourse to the courts, he suggests, will ensure that the FIC does not over reach.
“We want to increase the risk for those that are playing at the edges of legality -- it is all about identifying the proceeds of crime and asking how [the state] can get its hands on them,” Michell said. He can expect a battle.
http://www.mg.co.za/articlePage.aspx?articleid=338966&area=/insight/insight__economy__business/
Controversial new legislation designed to tighten up the enforcement of existing rules is simply a pre-lude to a more thorough review of the way the centre and its enabling legislation work, he told the Mail & Guardian this week, and measures that consumers and banks already chafe at may get much more demanding.
“We need more efficient customer identification, and in some jurisdictions there is customer due-diligence. In other words, not just who your client is, but what transactions has he done in the past? Has the pattern changed? That is a lot more onerous than what we currently have, but that is where we ultimately have to go,” he said.
That review process, which Michell estimates will take another three years, is likely to further irk critics of a Bill proposing amendments to the Financial Intelligence Centre Act (Fica) that is working its way through Parliament.
Key features of the new legislation include an administrative track for enforcement of Fica rules alongside the existing criminal avenue, substantially increased fines for non-compliance, and a new enforcement role for the centre. The FIC will now act as a supervisor for those sectors that are covered by legislation but have no supervisory body, such as the motor industry. More controversially, it also wants the power to step in where it feels existing supervisory bodies, like the Financial Services Board, have not done enough.
Critics, principally in the legal and accounting professions, argue that the changes would turn the centre into an unaccountable super-regulator, and push already high compliance costs.
But Michell insists that the legislation simply plugs gaps in the original Act. “[Banks and other institutions covered by the Act] don’t have to do anything new. What the Bill does do is increase the risk of non-compliance.
“Supervisory bodies such as the Financial Services Board were given responsibility by the original Act to enforce its provisions, but no clear legal mandate. They are now given that mandate,” he said.
“In some cases, like Fidentia, there was deliberate non-compliance so they could move funds around. That is criminal. But 99% of non-compliance is administrative in nature. You don’t want to go to court because an estate agent hasn’t kept their files properly.”
Consultation, appeals processes, and the right of recourse to the courts, he suggests, will ensure that the FIC does not over reach.
“We want to increase the risk for those that are playing at the edges of legality -- it is all about identifying the proceeds of crime and asking how [the state] can get its hands on them,” Michell said. He can expect a battle.
http://www.mg.co.za/articlePage.aspx?articleid=338966&area=/insight/insight__economy__business/
on Friday, May 11, 2012
The Swiss government is investigating money laundering charges against British defence company BAE Systems.
Switzerland’s public ministry of the confederation has opened three criminal investigations as a result of alerts by Switzerland's Money Laundering Reporting Office.
BAE Systems has also been investigated by Britain's Serious Fraud Office for its operations in the Czech Republic, Romania, Chile, Qatar, South Africa and Tanzania.
In 2006, the British office dropped a probe into the company that could have implicated Saudi officials over bribes allegedly taken over an arms contract of 53.5 billion euros.
Source: Beijing News
Switzerland’s public ministry of the confederation has opened three criminal investigations as a result of alerts by Switzerland's Money Laundering Reporting Office.
BAE Systems has also been investigated by Britain's Serious Fraud Office for its operations in the Czech Republic, Romania, Chile, Qatar, South Africa and Tanzania.
In 2006, the British office dropped a probe into the company that could have implicated Saudi officials over bribes allegedly taken over an arms contract of 53.5 billion euros.
Source: Beijing News
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on Monday, May 7, 2012
CAPE TOWN (Reuters) - South Africa's fight against money laundering and terrorism financing needs tough new laws to close regulatory loopholes and give authorities more power to crack down on crime, a top financial official said on Tuesday.
Murray Michell, the head of South Africa's Financial Intelligence Centre (FIC), said draft laws being debated by parliament would also help unclog an overburdened judicial system and streamline oversight.
"What the bill seeks to do is establish an administrative enforcement framework which will enhance supervision and enhance compliance," Michell said.
Laws to combat money laundering and terrorism financing have come under the spotlight since the Sept 11, 2001 attacks on New York and Washington, as investigators try to keep militants from abusing the international financial system to finance attacks, training and communication networks.
Michell said South African authorities had noticed that the existing Financial Intelligence Centre Act had gaps which were compromising these efforts -- especially when it came to acting quickly against violations.
"(This absence has had) a negative effect on the ability to develop the anti-money laundering/terror financing regime as a whole and the key area ... is that of compliance enforcement," Michell said.
He said the new laws would allow the FIC and other supervisory bodies to make inspections, issue directives, impose administrative sanctions and apply for court orders to ban certain suspicious activities.
The laws also propose a range of sanctions including fines of up to 10 million rand ($1.33 million) for individuals and 50 million rand for companies contravening FICA.
Michell said FICA's current provisions made the process of criminal sanctions too lengthy and complex to be effective.
Some critics have expressed concern that the new laws would create regulatory overlaps between the FIC and other supervisory bodies and could give the FIC too much power. The treasury has dismissed the concerns as "misconceptions".
Source: Reuters
Murray Michell, the head of South Africa's Financial Intelligence Centre (FIC), said draft laws being debated by parliament would also help unclog an overburdened judicial system and streamline oversight.
"What the bill seeks to do is establish an administrative enforcement framework which will enhance supervision and enhance compliance," Michell said.
Laws to combat money laundering and terrorism financing have come under the spotlight since the Sept 11, 2001 attacks on New York and Washington, as investigators try to keep militants from abusing the international financial system to finance attacks, training and communication networks.
Michell said South African authorities had noticed that the existing Financial Intelligence Centre Act had gaps which were compromising these efforts -- especially when it came to acting quickly against violations.
"(This absence has had) a negative effect on the ability to develop the anti-money laundering/terror financing regime as a whole and the key area ... is that of compliance enforcement," Michell said.
He said the new laws would allow the FIC and other supervisory bodies to make inspections, issue directives, impose administrative sanctions and apply for court orders to ban certain suspicious activities.
The laws also propose a range of sanctions including fines of up to 10 million rand ($1.33 million) for individuals and 50 million rand for companies contravening FICA.
Michell said FICA's current provisions made the process of criminal sanctions too lengthy and complex to be effective.
Some critics have expressed concern that the new laws would create regulatory overlaps between the FIC and other supervisory bodies and could give the FIC too much power. The treasury has dismissed the concerns as "misconceptions".
Source: Reuters
on Saturday, May 5, 2012
The Special Investigation Division of the Supreme Prosecutors Office on Friday listed a college classmate of former first lady Wu Shu-jen as a defendant for allegedly helping Wu with money laundering, increasing the number of defendants in the case to 12.
Prosecutor Chen Yun-nan, director of the division, confirmed that his division had summoned Wu's former classmate Tsai Mei-li for questioning as a defendant in the case, but said Tsai begged out of the session because she was ill.
Tsai's two brothers -- Tsai Ming-che and Tsai Ming-chieh -- have already been listed as defendants in the case for allegedly serving as proxies in helping the former first family launder money abroad.
In addition to Wu, three other members of the former first family -- former President Chen Shui-bian, son Chen Chih-chung and daughter-in-law Huang Jui-ching -- have all been listed as chief defendants in the money laundering case.
Others listed as defendants include the former first lady's elder brother Wu Ching-mao, his wife Chen Chun-ying, former Mega Financial Holding Co. Chairman Cheng Shen-chih, Yuanta Securities board member Tu Li-ping, and former Presidential Office cashier Chen Chen-hui.
None of those listed as defendants in the case have been indicted on charges related to money laundering, as at this stage in the investigation they are still only viewed as suspects.
Wu Ching-mao was released Nov. 28 on NT$2 million (US$59,580) bail after he had been held in custody for 53 days to prevent possible collusion among the defendants and witnesses.
Prosecutors who examined the information provided by judicial authorities of Singapore about an account owned by Wu Ching-mao believe they have enough evidence to suspect that Tsai Mei-li and her brothers helped the former first lady transfer millions of U. S. dollars illegally to her brother's account with South Africa's Standard Bank in Singapore through their bank accounts in Hong Kong.
Prosecutors found that they money was later wired to a Swiss bank account held by the son and daughter-in-law of the former president and his wife.
Before listing Tsai Mei-li as a defendant, the prosecutors questioned her four times. On Sept. 25, they searched her residence and office for possible evidence. Her brother Tsai Ming-che has been held in custody since Oct. 2.
In addition to their alleged violations of laws against money laundering, Chen Shui-bian and his wife also face investigation on charges of embezzling state affairs funds of the Presidential Office and accepting bribes during the former president's two terms between 2000 and 2008.
With the permission of the Taipei District Court, the Special Investigation Division has detained the former president since Nov. 12, after interrogating him for six hours a day earlier.
Source: Taiwan News
Prosecutor Chen Yun-nan, director of the division, confirmed that his division had summoned Wu's former classmate Tsai Mei-li for questioning as a defendant in the case, but said Tsai begged out of the session because she was ill.
Tsai's two brothers -- Tsai Ming-che and Tsai Ming-chieh -- have already been listed as defendants in the case for allegedly serving as proxies in helping the former first family launder money abroad.
In addition to Wu, three other members of the former first family -- former President Chen Shui-bian, son Chen Chih-chung and daughter-in-law Huang Jui-ching -- have all been listed as chief defendants in the money laundering case.
Others listed as defendants include the former first lady's elder brother Wu Ching-mao, his wife Chen Chun-ying, former Mega Financial Holding Co. Chairman Cheng Shen-chih, Yuanta Securities board member Tu Li-ping, and former Presidential Office cashier Chen Chen-hui.
None of those listed as defendants in the case have been indicted on charges related to money laundering, as at this stage in the investigation they are still only viewed as suspects.
Wu Ching-mao was released Nov. 28 on NT$2 million (US$59,580) bail after he had been held in custody for 53 days to prevent possible collusion among the defendants and witnesses.
Prosecutors who examined the information provided by judicial authorities of Singapore about an account owned by Wu Ching-mao believe they have enough evidence to suspect that Tsai Mei-li and her brothers helped the former first lady transfer millions of U. S. dollars illegally to her brother's account with South Africa's Standard Bank in Singapore through their bank accounts in Hong Kong.
Prosecutors found that they money was later wired to a Swiss bank account held by the son and daughter-in-law of the former president and his wife.
Before listing Tsai Mei-li as a defendant, the prosecutors questioned her four times. On Sept. 25, they searched her residence and office for possible evidence. Her brother Tsai Ming-che has been held in custody since Oct. 2.
In addition to their alleged violations of laws against money laundering, Chen Shui-bian and his wife also face investigation on charges of embezzling state affairs funds of the Presidential Office and accepting bribes during the former president's two terms between 2000 and 2008.
With the permission of the Taipei District Court, the Special Investigation Division has detained the former president since Nov. 12, after interrogating him for six hours a day earlier.
Source: Taiwan News
on Tuesday, May 1, 2012
By Lavern de Vries
Organised crime syndicates, including Mafia organisations, are believed to have moved their financial operations to South Africa, says award-winning journalist John Grobler.
Grobler, who was speaking at a briefing on organised crime and money laundering at the Institute for Security Studies in the Cape Town on Monday, said it was because money laundering was easy here because of an unsophisticated anti-crime corruption unit and the ability to exploit officials.
Grobler won the 2007 CNN African Freelance Journalist of the Year Award for a story on how Mafia bosses were buying unused diamond cutting and polishing licences, allegedly with the help of Zackey Nujoma, son of former Namibian president Sam Nujoma.
The article detailed confusion over whether Pietro Palazzolo or his alleged crime boss brother, Vito Palazzolo, had been appointed a director of one of the companies that bought the licences.
Originally from Sicily, Vito Palazzolo was granted South African citizenship 13 years ago and has lived in Cape Town since.
Nearly two decades ago he served a sentence in Switzerland for laundering drug money.
He has appeared in local courts on a number of charges including fraud and forgery related to his South African citizenship.
Palazzolo was convicted, in absentia, two years ago by a tribunal in Palermo, Sicily, of associating with the Mafia and sentenced to nine years.
Last year Italy asked for him to be extradited and the justice department said earlier this year it would only begin processing the extradition request once his appeal against that conviction was finalised.
Grobler said the authorities should not think of organised crime in the conventional way of Italian bosses involved in drug smuggling and prostitution.
"It is far more sophisticated and they are moving from that image into one with more respectability where they appear to be involved in turning around diamonds."
Grobler, who spent 18 months investigating his award-winning story, said research had led him to believe that Mafia families from different nationalities used their political connections in Namibia to obtain diamond cutting licences.
Namibia was targeted because of its lucrative mining industry and easy access to influential people, while South Africa's lack of border control and its stable economy was ideal for money laundering operations, he said.
Although drugs, racketeering and prostitution was still the core part of organised crime, it was also currently being seen as the bottom rung of the business.
"I think they still set up deals but they don't get their hands dirty anymore."
Grobler said specialised units such as the Scorpions, whose future hangs in the balance, were ideal to deal with the now mature forms of organised crime.
This article was originally published on page 7 of Cape Argus on September 30, 2008
Organised crime syndicates, including Mafia organisations, are believed to have moved their financial operations to South Africa, says award-winning journalist John Grobler.
Grobler, who was speaking at a briefing on organised crime and money laundering at the Institute for Security Studies in the Cape Town on Monday, said it was because money laundering was easy here because of an unsophisticated anti-crime corruption unit and the ability to exploit officials.
Grobler won the 2007 CNN African Freelance Journalist of the Year Award for a story on how Mafia bosses were buying unused diamond cutting and polishing licences, allegedly with the help of Zackey Nujoma, son of former Namibian president Sam Nujoma.
The article detailed confusion over whether Pietro Palazzolo or his alleged crime boss brother, Vito Palazzolo, had been appointed a director of one of the companies that bought the licences.
Originally from Sicily, Vito Palazzolo was granted South African citizenship 13 years ago and has lived in Cape Town since.
Nearly two decades ago he served a sentence in Switzerland for laundering drug money.
He has appeared in local courts on a number of charges including fraud and forgery related to his South African citizenship.
Palazzolo was convicted, in absentia, two years ago by a tribunal in Palermo, Sicily, of associating with the Mafia and sentenced to nine years.
Last year Italy asked for him to be extradited and the justice department said earlier this year it would only begin processing the extradition request once his appeal against that conviction was finalised.
Grobler said the authorities should not think of organised crime in the conventional way of Italian bosses involved in drug smuggling and prostitution.
"It is far more sophisticated and they are moving from that image into one with more respectability where they appear to be involved in turning around diamonds."
Grobler, who spent 18 months investigating his award-winning story, said research had led him to believe that Mafia families from different nationalities used their political connections in Namibia to obtain diamond cutting licences.
Namibia was targeted because of its lucrative mining industry and easy access to influential people, while South Africa's lack of border control and its stable economy was ideal for money laundering operations, he said.
Although drugs, racketeering and prostitution was still the core part of organised crime, it was also currently being seen as the bottom rung of the business.
"I think they still set up deals but they don't get their hands dirty anymore."
Grobler said specialised units such as the Scorpions, whose future hangs in the balance, were ideal to deal with the now mature forms of organised crime.
This article was originally published on page 7 of Cape Argus on September 30, 2008
on Monday, April 2, 2012
by David Leigh
Count Alfons Mensdorff-Pouilly questioned over €13m payment from British arms company
An Austrian count and lobbyist for the British arms company BAE has been arrested, making him the first of the company's global network of confidential agents to be held in custody in five years of bribery investigations by international authorities.
Count Alfons Mensdorff-Pouilly is being detained in Austria after being arrested on Friday, a spokesman for the Vienna regional court for criminal matters, Christian Gneist, said. He faces a court hearing on 16 March.
Under Austrian law, pre-trial custody can last up to six months if an investigating judge deems it necessary.
Mensdorff-Pouilly owns a castle in Scotland and is married to the former Austrian health minister Maria Rauch-Kallat. He was arrested at his house in Luising, Austria, according to his lawyer, Harald Schuster, who claimed the accusations, which include money laundering, were groundless.
BAE, Europe's biggest arms manufacturer, declined to comment on the arrest.
The Austrian investigation, which follows one by British authorities, relates to lease agreements from 2003 and 2004. Hungary renewed a lease for 14 Gripen planes and the Czech government agreed to lease 14 planes over 10 years. BAE marketed the planes, which are produced by the Swedish company Saab, in which BAE has a 21% stake.
Mensdorff-Pouilly is being questioned in connection with a €13m (£11.6m) payment allegedly made to him by BAE, for whom he had been a consultant for 16 years. Documents which have emerged in the case link BAE to secret payments made to an intermediary company called Valurex, in Switzerland.
Following exposure by the Guardian of the original bribery allegations against BAE, a report last year by the retired British judge Lord Woolf said the arms giant had paid "insufficient attention" to ethical standards when doing arms deals. After strenuous lobbying by BAE, a British investigation by the Serious Fraud Office (SFO) into bribery allegations in Saudi Arabia was halted by the then prime minister, Tony Blair, on the grounds it would compromise national security.
But the SFO continued to work with international prosecutors on allegations against BAE in eastern Europe, Tanzania, Chile and South Africa. They obtained production orders from BAE and its bankers, Lloyds TSB, which unearthed links with Mensdorff-Pouilly's companies.
Last year, the count was stopped for questioning by the SFO on the way home from Dalnaglar Castle in Perthshire, a property he bought after the conclusion of the Czech deals.
The US justice department has been negotiating with BAE about the possibility of a settlement in a parallel investigation into possible breaches of the US Foreign Corrupt Practices Act.
Source: The Guardian
Count Alfons Mensdorff-Pouilly questioned over €13m payment from British arms company
An Austrian count and lobbyist for the British arms company BAE has been arrested, making him the first of the company's global network of confidential agents to be held in custody in five years of bribery investigations by international authorities.
Count Alfons Mensdorff-Pouilly is being detained in Austria after being arrested on Friday, a spokesman for the Vienna regional court for criminal matters, Christian Gneist, said. He faces a court hearing on 16 March.
Under Austrian law, pre-trial custody can last up to six months if an investigating judge deems it necessary.
Mensdorff-Pouilly owns a castle in Scotland and is married to the former Austrian health minister Maria Rauch-Kallat. He was arrested at his house in Luising, Austria, according to his lawyer, Harald Schuster, who claimed the accusations, which include money laundering, were groundless.
BAE, Europe's biggest arms manufacturer, declined to comment on the arrest.
The Austrian investigation, which follows one by British authorities, relates to lease agreements from 2003 and 2004. Hungary renewed a lease for 14 Gripen planes and the Czech government agreed to lease 14 planes over 10 years. BAE marketed the planes, which are produced by the Swedish company Saab, in which BAE has a 21% stake.
Mensdorff-Pouilly is being questioned in connection with a €13m (£11.6m) payment allegedly made to him by BAE, for whom he had been a consultant for 16 years. Documents which have emerged in the case link BAE to secret payments made to an intermediary company called Valurex, in Switzerland.
Following exposure by the Guardian of the original bribery allegations against BAE, a report last year by the retired British judge Lord Woolf said the arms giant had paid "insufficient attention" to ethical standards when doing arms deals. After strenuous lobbying by BAE, a British investigation by the Serious Fraud Office (SFO) into bribery allegations in Saudi Arabia was halted by the then prime minister, Tony Blair, on the grounds it would compromise national security.
But the SFO continued to work with international prosecutors on allegations against BAE in eastern Europe, Tanzania, Chile and South Africa. They obtained production orders from BAE and its bankers, Lloyds TSB, which unearthed links with Mensdorff-Pouilly's companies.
Last year, the count was stopped for questioning by the SFO on the way home from Dalnaglar Castle in Perthshire, a property he bought after the conclusion of the Czech deals.
The US justice department has been negotiating with BAE about the possibility of a settlement in a parallel investigation into possible breaches of the US Foreign Corrupt Practices Act.
Source: The Guardian
on Tuesday, March 6, 2012
The UAE said yesterday it will sign new anti-money laundering agreements with 82 countries as part of an intensified strategy to combat dirty funds.
The National Anti-Money Laundering Committee (NAMLC) discussed the plans at a meeting that also covered recent cases of currency fraud and other issues.
The Central Bank, which organised the meeting in Dubai, said the committee heard that a memorandum of understanding (MoU) had so far been signed between the anti-money laundering unit and 21 countries.
They were told that the unit planned to sign MoUs with 82 other nations that were members of the Egmont Group, an international gathering of financial intelligence units.
Some of the countries covered by the agreements have large communities in the UAE and financial sources say the agreements will strengthen the drive to crack down on dirty money and ensure the banking system here remains clean.
"These agreements demonstrate the commitment of the UAE to share financial information with its global partners to co-ordinate the efforts against money laundering, terrorist financing and related crimes," a Central Bank spokesman said after some of the deals were signed earlier this year.
"These agreements were aimed at further supporting the UAE's continued co-operation with the international community on subjects of mutual concern and on ways to strengthen co-operation on combating money laundering."
MoUs were signed with the financial intelligence units of Lebanon, Belgium, Brazil, Croatia, Estonia, Isle of Man, Macedonia, Malawi, Monaco, Nigeria, Portugal, the Philippines, Serbia, South Africa and other countries.
The agreements followed a pledge by the UAE last year to push ahead with an extensive campaign against money laundering and terrorist funding through intensified regional and international co-operation.
Source: Emirates Business 24/7
The National Anti-Money Laundering Committee (NAMLC) discussed the plans at a meeting that also covered recent cases of currency fraud and other issues.
The Central Bank, which organised the meeting in Dubai, said the committee heard that a memorandum of understanding (MoU) had so far been signed between the anti-money laundering unit and 21 countries.
They were told that the unit planned to sign MoUs with 82 other nations that were members of the Egmont Group, an international gathering of financial intelligence units.
Some of the countries covered by the agreements have large communities in the UAE and financial sources say the agreements will strengthen the drive to crack down on dirty money and ensure the banking system here remains clean.
"These agreements demonstrate the commitment of the UAE to share financial information with its global partners to co-ordinate the efforts against money laundering, terrorist financing and related crimes," a Central Bank spokesman said after some of the deals were signed earlier this year.
"These agreements were aimed at further supporting the UAE's continued co-operation with the international community on subjects of mutual concern and on ways to strengthen co-operation on combating money laundering."
MoUs were signed with the financial intelligence units of Lebanon, Belgium, Brazil, Croatia, Estonia, Isle of Man, Macedonia, Malawi, Monaco, Nigeria, Portugal, the Philippines, Serbia, South Africa and other countries.
The agreements followed a pledge by the UAE last year to push ahead with an extensive campaign against money laundering and terrorist funding through intensified regional and international co-operation.
Source: Emirates Business 24/7
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on Thursday, March 1, 2012
Regional efforts to fight money laundering and terrorist financing suffered a blow this month when the Tanzanian government broke ranks at a council of finance ministers by preventing approval of a report that painted it in a bad light.
Assessments of the efforts by Tanzania and SA to fight money laundering and terrorist financing were tabled for adoption by a meeting of finance ministers in Maseru on August 20.
The reports had been approved by officials of the regional body co- ordinating the fight against the illegal practices and were due to be adopted at ministerial level. SA put its report forward. Tanzania did not.
"Postponement of the approval by the council of ministers... was unexpected, as the approval of the Tanzania report was on the ministers' agenda," said Paul Vlaanderen, president of the Paris-based Financial Action Task Force (FATF), the peak intergovernmental body on the issue.
The Tanzanian move clouds the region's processes to combat money laundering and terrorist financing .
"It may raise perceptions of higher risk from a money-laundering control perspective of the region and institutions that have correspondent relations with Tanzanian financial institutions," said a source from the Eastern and Southern Africa Anti-Money Laundering Group.
The extent of money laundered is unknown, but in 1996 the International Monetary Fund put it at 2%-5% of the world's gross domestic product.
Developing countries have a vulnerability to money laundering in a higher level of cash transactions compared to developed countries. The global financial crisis increases this vulnerability as a loss of confidence in the formal banking system encourages more people to stick to cash.
The group's 14 members submit themselves to mutual evaluations, based on on-site visits and adoption of the resulting reports. The Tanzanian report highlighted a failure to implement an antimoney-laundering law on the island of Zanzibar, a source with knowledge of the meeting said. The finance ministers agreed to meet again by December to approve the Tanzanian report, the source said.
"The postponement of the approval of the Tanzania report has no consequences for the group. That might change if the report would not be approved.
"In that case the FATF would have to consider the consequences," Vlaanderen said.
Tanzania's finance minister on Friday defended his decision at the ministerial council. "What we said is there are some weaknesses (in the report) that have to be corrected," Finance Minister Mustafa Mkulo told Business Day. "Ministers agreed that it had to be redone and will be discussed some time in December."
South African officials declined to comment.
Source: AllAfrica
Assessments of the efforts by Tanzania and SA to fight money laundering and terrorist financing were tabled for adoption by a meeting of finance ministers in Maseru on August 20.
The reports had been approved by officials of the regional body co- ordinating the fight against the illegal practices and were due to be adopted at ministerial level. SA put its report forward. Tanzania did not.
"Postponement of the approval by the council of ministers... was unexpected, as the approval of the Tanzania report was on the ministers' agenda," said Paul Vlaanderen, president of the Paris-based Financial Action Task Force (FATF), the peak intergovernmental body on the issue.
The Tanzanian move clouds the region's processes to combat money laundering and terrorist financing .
"It may raise perceptions of higher risk from a money-laundering control perspective of the region and institutions that have correspondent relations with Tanzanian financial institutions," said a source from the Eastern and Southern Africa Anti-Money Laundering Group.
The extent of money laundered is unknown, but in 1996 the International Monetary Fund put it at 2%-5% of the world's gross domestic product.
Developing countries have a vulnerability to money laundering in a higher level of cash transactions compared to developed countries. The global financial crisis increases this vulnerability as a loss of confidence in the formal banking system encourages more people to stick to cash.
The group's 14 members submit themselves to mutual evaluations, based on on-site visits and adoption of the resulting reports. The Tanzanian report highlighted a failure to implement an antimoney-laundering law on the island of Zanzibar, a source with knowledge of the meeting said. The finance ministers agreed to meet again by December to approve the Tanzanian report, the source said.
"The postponement of the approval of the Tanzania report has no consequences for the group. That might change if the report would not be approved.
"In that case the FATF would have to consider the consequences," Vlaanderen said.
Tanzania's finance minister on Friday defended his decision at the ministerial council. "What we said is there are some weaknesses (in the report) that have to be corrected," Finance Minister Mustafa Mkulo told Business Day. "Ministers agreed that it had to be redone and will be discussed some time in December."
South African officials declined to comment.
Source: AllAfrica
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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on Tuesday, December 12, 2006
Jakarta (ANTARA News) - Indonesia through the Financial Transaction Analysis and Report Center (PPATK) forged cooperation with the financial intellegence agencies of Cayman Island and South Africa in preventing and combating money laundering.
A spokesman for PPATK, Natsir Kongah, said here on Monday that the cooperation agreements were strategic, considering that Caymand Island was one of the biggest financial centers in the world, while South Africa was also the biggest financial center on the African continent.
The signing of documents of agreement between PPATK and Financial Reporting Authority (CAYFIN) of Caymand Island and the Financial Intelligence Center of South Africa was believed to be decisive to strengthen international cooperation often conducted by the respective countries in promoting the exchange of information especially on money laundering and other crimes.
Caymand Island, an island resort discovered by Christopher Columbus on May 10, 1503, was well-known as one of the world`s five biggest financial centers. At least 350 banks and trust companies are operating there with around one trillion US dollars circulating in the region.
This small country is also a place of 8,000 mutual funds and 65,000 corporations. Around 1,000 companies have listed their shares at the Caymand Island`s Stock Exchange.
According to Natsir, the procedure of PPATK cooperation with CAYFIN and FIC was based on article 25, point 3, 2002 of the revised law No 25, 2003 on money laundering which allowed PPATK to prevent and combat money laundering under cooperation with other relevant national and international parties.
The cooperation was an effort to strengthen the close relations with the internatioal world especially Caymand Island and South Africa as members of the Egmont Group.
The substance of the agreement has to do with cooperation in the exchange of financial intelligence information relating to the prevention and eradication of money laundering and the funding of terrorist groups.
Information is credential in nature and it is also an obligation of each institution to maintain the credentiality of the information, which should not be made as evidence at a court of law, and could be passed on to other parties without written approval from the owners of the information or institutions.(*)
Copyright © 2006 ANTARA , December 12, 2006
http://www.antara.co.id/en/seenws/?id=24616
A spokesman for PPATK, Natsir Kongah, said here on Monday that the cooperation agreements were strategic, considering that Caymand Island was one of the biggest financial centers in the world, while South Africa was also the biggest financial center on the African continent.
The signing of documents of agreement between PPATK and Financial Reporting Authority (CAYFIN) of Caymand Island and the Financial Intelligence Center of South Africa was believed to be decisive to strengthen international cooperation often conducted by the respective countries in promoting the exchange of information especially on money laundering and other crimes.
Caymand Island, an island resort discovered by Christopher Columbus on May 10, 1503, was well-known as one of the world`s five biggest financial centers. At least 350 banks and trust companies are operating there with around one trillion US dollars circulating in the region.
This small country is also a place of 8,000 mutual funds and 65,000 corporations. Around 1,000 companies have listed their shares at the Caymand Island`s Stock Exchange.
According to Natsir, the procedure of PPATK cooperation with CAYFIN and FIC was based on article 25, point 3, 2002 of the revised law No 25, 2003 on money laundering which allowed PPATK to prevent and combat money laundering under cooperation with other relevant national and international parties.
The cooperation was an effort to strengthen the close relations with the internatioal world especially Caymand Island and South Africa as members of the Egmont Group.
The substance of the agreement has to do with cooperation in the exchange of financial intelligence information relating to the prevention and eradication of money laundering and the funding of terrorist groups.
Information is credential in nature and it is also an obligation of each institution to maintain the credentiality of the information, which should not be made as evidence at a court of law, and could be passed on to other parties without written approval from the owners of the information or institutions.(*)
Copyright © 2006 ANTARA , December 12, 2006
http://www.antara.co.id/en/seenws/?id=24616
on Monday, December 11, 2006
JAKARTA (AFP) - Indonesia's anti-money laundering watchdog has signed agreements with the Cayman Islands and South Africa to exchange financial intelligence and help combat the financing of terrorism.
http://cayman-island-travel.com/2006/12/11/indonesia-south-africa-cayman-expand-cooperation-on-money-laundering-afp-via-yahoo7-news/
http://cayman-island-travel.com/2006/12/11/indonesia-south-africa-cayman-expand-cooperation-on-money-laundering-afp-via-yahoo7-news/
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