Stop money laundering! International conference

The first international STOP Money Laundering! conference was held in London in February 2002.

It was opened by Hilary Benn MP Under-Secretary of State for the Department of international development, and chaired by David Goldberg, partner at Kennedy's international law firm and secretary of the Anglo-Russian Law Association and Ian Mann, managing director of LCT, organisers of the conference.

In response to pressure from delegates and official bodies represented at the Conference it has been decided that a second ‘STOP Money Laundering!’ conference will be held again soon.

Communique

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The total of the sums involved in money laundering is huge and stands in the way of the economic development of many countries. The Conference underlined the importance of fighting Money Laundering which is also recognised as a major source of terrorist funding.

This communique, based on the recommendations of the Conference’s participants, is addressed to all those involved in the regulation and prevention of money laundering, namely:
the United Nations, FATF, IMF, World Bank, Governments, Ministries of Finance, Central Banks, Commercial Bankers’ Associations and other national and international organisations and regulatory and control bodies.

Taking into consideration the fact that different states around the world have varied political and economic systems and levels of social development, each country may have a different approach to fighting money laundering. The discussions showed that the definition of ‘money laundering’ / ‘economic crime’ is not the same in all countries.

There are cases when the controlling authorities make mistakes in blocking or freezing accounts suspected of being involved in money laundering activities. Where it is found that the suspects are not involved in money laundering activities there should be compensation for the aggrieved parties.

Some progress has already been made

The banking system of the Russian Federation has achieved significant results in achieving further transparency and in anti-laundering activities.

It was recognized by the Conference’s participants that the Ukraine is making progress in the fight against money laundering. Illustration from some recent investigations carried out by the Ukrainian Tax Police show that the Ukraine is fulfilling FATF’s obligations in combating money laundering. Significant arrests and the freezing of suspect accounts in the Ukraine and abroad are examples of international co-operation in the fight against money laundering. Taking into consideration the efforts of the Ukraine and the practical results achieved, it was felt that its position on FATF’s black list was due for examination and reconsideration.

The return of stolen funds

All laws and regulations that inhibit the restitution of money which has been stolen and laundered must be revised.

All governments, and in particular in those countries which have suffered badly from the theft of national funds, should pass legislation to make it increasingly difficult for such monies to be lodged in any bank in the world.

All the monies stolen from countries like Nigeria, Democratic Republic of Congo, Zimbabwe etc. should be returned to these countries forthwith after the due process of law has been followed. Legal delays must be reduced and the whole process accelerated.

The developed countries should not hide under the due process of law as a reason for delay before returning stolen money to the appropriate third world countries.

Changes which need to be implemented

The global co-operation that is being advocated in all the money laundering seminars should not just be left as spoken or written words but should be acted upon and put into practice.

Established cases of financial crime must be dealt with promptly and severely. We all know that without justice there will be no real peace.

All legislation that tends to encourage the receiving of dirty money into countries, particularly the developed countries, should be amended and make it increasingly difficult to bring in such money.

There should be enhanced co-operation between the developed countries and the developing countries in expediting the return of laundered money to the people from whom it was stolen.

It is clearly felt by some nations, and in particular by the African countries, that the West is being hypocritical in criticising them for being the source of money which is laundered, when it is the West which is to blame for facilitating money laundering by accepting the funds in the first place. The West should change its approach by showing genuine concern for anti-money laundering particularly as it concerns developing countries.

Positive actions which should be taken

The international banking community should progress from the recommendation stage to the stage of providing banking standards and requirements.

There is an urgent need to make banking instructions and other documentation of leading Western banks and controlling authorities more readily available to the Central banks of the emerging markets.

The training of bank officials should be organised on a multi-lateral level with participation of IMF, BIS and FATF.

Correspondence banking relationships must be reviewed taking into consideration not only the requirements of ‘know your customer’ but also ‘know the underlying transactions’. The international community cannot afford to pay mere lip service to financial crimes because the consequences can be very grave.

Monetary teams should be set up to improve compliance with money laundering rules and regulations, especially in the financial tribunals. Membership of the teams must be worked out later. There must be equitable representation.

More seminars and conferences in the future with participation of the leading organisations such as FATF, UN, World Bank, IMF etc. should be set up without further delay. miles.pearson@tiscali.co.uk