Qatar Exaggerates IMF Assessment of Anti-Terrorist Financing Regime

By Andrew Cochran

A headline in the October 7 issue of "The Peninsula," a leading daily newspaper in Qatar, boasts, "Country free of terror financing: IMF report," with the lead sentence, "A report just issued by the International Monetary Fund (IMF) has given Qatar a clean bill of health stating there is no terrorism financing and minimal money laundering taking place in the country, if at all."

Which would be great if the report really says that... but it doesn't. Here are a few selections from the actual report, available in full here. You be the judge:

"Terrorist financing is criminalized, albeit in a limited way, under Article 4 of the Law No. (3) of 2004 on Combating Terrorism (CT Law). It may apply with respect to all “terrorist crimes” which cover all the offenses listed in the standard, bar the unlawful seizure of an aircraft carried out with no intention to terrorize, cause harm, death or material damage and with no political motive... The offense, therefore, does not extend to the collection of material or financial assistance for and their provision to terrorist individuals or for a terrorist act." (Page 9.)

"(A)n interdepartmental committee has been established to coordinate Qatar’s efforts in the implementation of United Nations Security Council Resolution (UNSCR) 1267 and the international conventions on the fight against terrorism, but its mandate does not cover UNSCR 1373; no authority has been granted the powers to designate terrorists; and there is no legal basis for freezing under the relevant UNSCR... It also appeared that, on one occasion, the authorities offered safe harbor to a person designated under UNSCR 1267. No actions were taken with respect to this person’s funds and other assets." (Page 10.)

"The preventive measures for financial institutions in the domestic sector fall short of addressing a vast majority of the customer due diligence elements of the international standard... The current obligations do not prohibit the opening of anonymous accounts or accounts in fictitious names. There are no direct requirements to determine whether a person is acting on behalf of the customer nor to identify and verify the beneficial owner of the account. The requirements for ensuring that customer documentation, information, or data are kept up-to-date are inadequate. Requirements for addressing enhanced due diligence for higher-risk categories are incomplete. There are no measures in place addressing politically exposed persons and cross-border correspondent relationships. There are no provisions covering the risk associated with new or developing technologies." (Page 11.)

"Overall, the terrorist financing offense meets most of the requirements set out in the ICSFT. However, several shortcomings remain: the coverage of terrorist acts is not sufficiently broad to be fully in line with the standard (for example, unlawful seizure of an aircraft is not considered a terrorist act in the absence of an intention to cause harm, death, terror or damage); this also limits the notion of terrorist groups or organizations; and the law does not cover the collection and provision of funds when there is no link to a terrorist group or organization. These shortcomings unduly limit the application of the terrorist financing offense." (Page 46.)

And the most troubling section in the report is about that aforementioned release of a U.N.-designated terrorist by the government (also on page 46):

"While the right for self-determination is an undisputable principle of international law reflected in the UN Charter, it should not serve to undermine the fight against terrorism (and its financing) as defined by the UN counter-terrorism Conventions and Protocols. The authorities, in an effort to uphold the right for self-determination, refused to extradite a Chechen rebel who was suspected of having committed violent acts against civilians of a foreign country. The individual in question was the subject of an arrest warrant issued by Interpol in 2001 and was designated as a terrorist by the UN Security Council 1267 Committee in June 2003. His name was included in the 1267 consolidated list from June 2003 onwards. The process that led the authorities to refuse the extradition and the exact response given to the requesting state were not shared with the assessors. The authorities mentioned during the on-site visit that the purpose of their refusal was to ensure the protection of a freedom fighter. They also indicated that none of the measures called for under the UNSC Resolution 1267 were taken with respect to this particular individual. It is, therefore, clear that from moment of the designation by the UN Security Council 1267 Committee in June 2003, until the individual's death in February 2004, the authorities provided him with a safe harbor and acted in violation of the UNSC Resolution 1267."

Please don't fill my inbox with stories of Qatari cooperation with the U.S. against certain terrorists, I already know that. There's still no excuse for that release. We can only hope that the practice was limited to one instance five years ago. As for the rest of the Qatari AML-CTF regime, there are obviously a lot of holes.

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