Is There Any Way to Give FATF Some Teeth!

By Victor Comras

By FATF standards, the organization has just completed a very successful three day meeting in Singapore. FATF and its Asia/Pacific counterpart organization both conducted a broad review of money laundering and terrorism financing issues. They continued, like the international community generally, to grapple with various aspects of the international financial system that continue to afford criminals and terrorists loopholes they can use to launder money and obtain and transfer funds to support terrorist indocrination, recruitment, maintenance and operations. These include the now well-studied alternative remmittance systems, such as hawala, and the use of cash couriers. They also include non banking institutions that deal in securities and high value commodities, as well as charities that raise and distribute funds. And, then, of course, there are those not- so-few jurisdictions that retain a lax attitude when it comes to actually overseeing and policing their own charities, and banking and financial institutions. All of these issues were discussed in FATF's latest annual report, issued June 10th, and will continue to remain on FAFT's active agenda. They will continue to engender discussion, best practices papers, and even new FATF recommendations, interpretations and guidelines. But unfortunately FATF will likely continue to give too many jurisdictions free passes when it comes to their actually carrying out these strictures. In fact, the only remaining FATF non-compliant or non cooperating countries, as they call them, are Burma, Nigeria and Nauru. And if these were the only countries with lax banking and financial oversight and enforcement, then much of the International Community's concerns about terrorism financing and money laundering would be well in hand. No, its time to give FAFT some real teeth. All countries which lack the means or political will to put in place and actually enforce current international counter--money laundering and terrorism financing standards and practices-- should be identified and subjected to appropriate international measures and pressures to conform. But, even when it comes to Burma, Nigeria, and Nauru, the 33 FAFT member countries have still not been able to agree on any real punitive measures to bring them in line.

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