The United Nations Office on Drugs and Crime (UNODC) and the Regional Cooperation Council (RCC) signed a Memorandum of Understanding here on Thursday to build security and the rule of law in South East Europe, in order to address the challenges posed by illicit drugs and organized crime in the region.

According to the United Nations press release, the Memorandum of Understanding is the basis for technical assistance to strengthen national administrative and institutional capacities, develop legislation and policies, and implement United Nations and European Union standards and principles.

The aim is to strengthen national criminal justice systems and the protection of human rights, while promoting the independence and integrity of institutions by tackling corruption. The sharing of knowledge and best practices will also be facilitated, the press release said.

Joint activities, such as regional and national projects, training, assessment and research, and awareness campaigns will be conducted to combat money-laundering, the financing of terrorism, and asset recovery, as well as to support the prevention and treatment of drug-related problems, including the spread of HIV/AIDS, it said.

Source:Xinhua

A former independent consultant was charged at the Sessions Court today with 11 counts of money laundering involving more than RM3.5 million.

Sukor Razali, 44, was charged with:

* Transferring RM250,000 obtained from illegal activities from an account in Al-Rajhi Banking & Investment Corporation Bhd into an account in Maybank belonging to a legal firm, Zahir Razak & Co.;

* Transferring RM1.04 million from the bank into four accounts belonging to Inter Milenia Services Sdn Bhd at RHB Bank; and

* Transferring RM595,800 from the Al-Rajhi account into two accounts belonging to IMSSB Enterprise in RHB Bank Bhd.

Milenia Services is a construction supply company while IMSSB Enterprise is a subsidiary of Milenia.

Sukor also faced two charges of disposing RM85,000, one of using RM739,500 to buy a Cashier’s Order and one of having RM858,999.84 in his possession.

All this money was allegedly obtained from illegal gains. Apart from these 11 charges, Sukor was slapped with three other charges under the Penal Code.

He was charged with two counts of criminal breach of trust of RM3 million, in his capacity as an independent consultant where he was entrusted with nine cheques belonging to Oberthur Card Systems Sdn Bhd.

The third charge was using a false document - Board Resolution For Account of A Limited Company - to open a current account at a bank.

Sukor allegedly committed the 14 offences at the Corporation in Jalan Ampang here between Feb 26 and May 31 last year. Sukor pleaded not guilty to all the charges.

Deputy Public Prosecutor Wan Farrah Farriza Wan Ghazali proposed RM500,000 bail with one surety for the first 11 charges and applied for his passport to be surrendered to court.

For the other three charges, deputy public prosecutor Nor Azilah Mat proposed RM300,000 bail with one surety.

Sukor’s counsel Jamal Abbas pleaded for the amount to be reduced and said that Sukor could only afford RM50,000.

“He is no longer working with the company and does a part time job with his friend,” said Jamal, adding that Sukor was also supporting his family in Kuching.

Sukor, who was given the opportunity to address the court by judge S.M. Komathy Suppiah, said he did not have any money to pay for the bail.

“There is no point in the lawyer asking for a reduced amount. I have no money to pay,” he said.

Komathy granted Sukor RM500,000 bail with one surety but ordered him to furnish a security in the sum of RM100,000.

She also ordered him to surrender his passport to the court and fixed June 16 for mention.

Source: New Straits Times

by Mary Spicuzza

Attorney General Eric H. Holder Jr. on Thursday spoke about using asset seizure and forfeiture to go after Mexican drug cartels during an appearance before the U.S. House of Representatives Committee on the Judiciary. Holder spoke of the goals, work and priorities of the U.S. Department of Justice, addressing topics ranging from counter-terrorism efforts and closing detention facilities at Guantanamo to investigating mortgage fraud and violent cartels.

He specifically cited the Justice Department's strategy for confronting violence, corruption and other threats posed by cartels. "This strategy uses federal prosecutor-led task forces that bring together federal, state and local law enforcement agencies to identify, disrupt and dismantle the Mexican drug cartels through investigation, prosecution, and extradition of their key leaders and facilitators, and seizure and forfeiture of their assets," Holder said in his statement. "The Department is increasing its focus on investigations and prosecutions of the southbound smuggling of guns and cash that fuel the violence and corruption, as well as attacking the cartels in Mexico itself, in partnership with the Mexican Attorney General's Office and the Secretariat of Public Security."

Holder's statements about seizure and forfeiture of cartels' assets come a month after President Barack Obama imposed financial sanctions on three of Mexico's most violent cartels — Sinaloa, Los Zetas and La Familia Michoacana — by adding them to the list of foreign "drug kingpins." The move to designate the trio under the Foreign Narcotics Kingpin Designation Act allows the U.S. government to seize or block the cartels' assets, accounts or securities subject to U.S. jurisdiction and prosecute U.S. citizens or companies who work with them.

Recently, the U.S. Department of State also released its Country Reports on Terrorism 2008, which criticized Mexico's recent terrorist financing law for its lack of asset forfeiture provisions, but offered praise for the country's efforts to combat violent cartels.

Source: Asset Forfeiture Watch

By JOSEPH A. MANN

Imported plain cotton pillow cases from France that cost more than $900 apiece and new bulldozers exported to Venezuela that cost $387 each. Such prices seem highly suspect -- and could be examples of someone using international trade to launder money.

Despite strict enforcement of federal anti-money-laundering laws, criminals are constantly finding ways to transform dirty money -- the proceeds of illegal activities -- into clean cash, and one of their most important routes is laundering money via international trade.

Money launderers are moving enormous sums through ports in Florida and other parts of the country by overvaluing or undervaluing exports and imports, said John Zdanowicz, a professor of finance at Florida International University.

Using a statistical program he developed to track money laundering, Zdanowicz analyzes U.S. government trade figures, calculates average prices for commodities and merchandise and searches the data for abnormally priced products.

The pillow cases and bulldozers are among the products he has turned up that seem to indicate trade may have been used to disguise the movement of money. But since the names of importers and exporters don't appear with government trade figures, Zdanowicz doesn't know who is moving the merchandise -- or the money.

''The front door of money laundering is the banking system,'' Zdanowicz said. ``The government has done a pretty good job of closing the front door, but the back door -- international trade -- is wide open.''

In its 2009 report, the U.S. State Department's Bureau of International Narcotics and Law Enforcement Affairs said annual estimates of trade-based money laundering reached into the hundreds of billions of dollars.

Lester Joseph, principal deputy chief at the Department of Justice criminal division, told participants at a recent anti-money-laundering conference in Miami that one of the government's priorities this year is to focus more attention on trade-related laundering.

As a center for world commerce, South Florida offers abundant opportunities for trade-related money laundering. Last year international trade in the Miami Customs District, which includes airports and seaports along the coast from Fort Pierce to Key West, reached an all-time high of $90.2 billion with exports of $54.9 billion and imports of $35.3 billion.

One way money launderers move large sums is by undervaluing exports to a foreign destination or by overvaluing imports. Alternatively, those overseas can use trade to move money into the U.S. by undervaluing goods shipped here or overvaluing merchandise exported from here to other countries.

CHEATING ON INVOICES

Zdanowicz explained how it would be easy to launder $1 million in cash quickly and move it out of the country: ``I'd buy 200 Rolex watches in Miami [at about $5,000 each] and export them to my partner in Colombia, charging $5 each on the invoice. My partner there pays me $1,000 for the shipment, sells the watches at the market rate in Colombia and we've laundered $1 million.

''I've heard about Corvettes being bought in Miami for $40,000 in cash and sending them to Latin America, invoicing them for $500,'' said Zdanowicz, who also is president of International Trade Alert, a firm that offers consulting services on international trade issues. The cars are then sold for $50,000 or more, thus making a profit while laundering money.

The over-valuation method works like this: ''Let's say my partner in Latin America spends $1,000 to buy 10,000 pencils at 10 cents each and ships them to me in Miami. The invoice says the pencils are worth $100 each, and I pay my partner $1 million. That way, I'm able to move $1 million out of the country in one operation,'' he said.

The same thing can happen with international services, such as marketing surveys, accounting and legal services and concert promotions. For example, a company in Venezuela may offer an advertising and marketing plan to a client in Miami for $2 million, when a plan of this type might cost $50,000. The Miami company writes a check or makes an international funds transfer, and $2 million legitimately leaves the country.

BOGUS SERVICES

In some cases, companies bill for services that are never delivered, said Kieran Beer, editor-in-chief of Fortent Inform and moneylaundering.com, which provide news and analysis on international money laundering, regulatory and fraud activities.

While some of the prices used in these examples may seem unrealistic, it is not illegal to overcharge or undercharge for merchandise or services, unless merchandise mispricing is designed to avoid paying Customs duties.

By comparing invoice prices with average world prices, Zdanowicz estimated that $192 billion was moved out of the U.S. in 2005 via undervalued exports and overvalued imports, and $189 billion in 2006.

''The IRS and [U.S.] Customs sometimes find these things, but they don't have the capability of analyzing [so much] data,'' Zdanowicz said. ``They're now pressuring the banks to monitor prices. They're trying to pass the buck to them.''

To combat trade-related money laundering, U.S. Immigration and Customs Enforcement has set up special operations called trade transparency units in Colombia, Brazil, Argentina, Mexico and Paraguay to detect and track money laundering as well as other illegal activities.

In fiscal year 2008, ICE launched more than 3,500 investigations into money laundering and other types of financial crimes, obtained 823 convictions and seized more than $260 million, an 81 percent increase over the previous year.

ICE can spot unusual trade pricing patterns and investigate trade fraud and money laundering through Customs inspections at U.S. ports and its trade transparency units in Latin America, said Jere Miles, ICE's Trade Transparency Unit chief in Washington, D.C.

LOOKING AT AVERAGES

Miles said that ICE uses average import and export prices to determine if items are grossly overpriced or underpriced, and also checks documentation. Some Latin governments cooperate with U.S. anti-money laundering efforts because they can lose millions of dollars in Customs duties on mispriced merchandise.

Asked what ICE could do if it detected something similar to the underpriced Rolex watches, he said the agency could ask an exporter to prove that the watches were purchased for $5 each or investigate where an importer here obtained large sums of money to pay for overpriced merchandise.

MASSIVE VOLUME

But ferreting out trade-related laundering is difficult because of the sheer volume of commerce. ''It's a game of numbers. What better place to hide illegal money than in trade because it accounts for hundreds of billions of dollars a year,'' said Miles.

And trade is just one of many conduits for cleaning up dirty money.

''Money laundering always invents new channels,'' said Beer. ``When it's blocked in one direction, it cuts a new stream, like water. Personally, I think that as long as American demand for illicit drugs continues, there will be a lot of incentive for money laundering and a lot of incentive to produce imaginative ways to move the profits of that trade.''

CLEVER TRICKS

Launders may funnel money through layers of supposedly legitimate businesses, invest in real estate and art, use foreign exchange dealers/brokers and move money across borders via stored value cards such as pre-paid gift cards, Internet payments and online gaming.

Or they may turn to more rudimentary methods, simply smuggling large volumes of cash out of the United States into other countries where anti-money laundering laws and rules are lax.

That's the route some drug dealers seem to prefer, and drug money often gets most of the media attention, usually when agents seize piles of cash.

Still, the government admits it finds only a tiny percentage of drug money. Americans spend approximately $65 billion per year on illegal drugs, according to the Office of National Drug Control Policy, but U.S. seizures by all federal agencies typically total only about $1 billion.

Despite the magnitude of the money laundering, the federal government claims to be making headway.

''We have made much progress in the field of detecting and prosecuting money launderers,'' said Ian McCaleb, a spokesman for the Department of Justice. ``For instance, some money launderers have switched to bulk cash smuggling after finding it harder to launder large amounts of money through financial institutions. But criminals are constantly adapting their techniques, and our challenge is to do all we can to stay as far ahead of new money laundering trends as possible.''

MANY DOUBTFUL

But others are skeptical and say despite well-publicized successes, the federal government is barely making a dent in money laundering, especially trade-related laundering.

''It depends on who you talk to as to whether all these anti-money laundering actions are working,'' said Beer of moneylaundering.com.

After 9/11, many federal investigative resources were diverted to anti-terrorist intelligence work, which includes money laundering related to terrorist financing. But this switch in emphasis at the federal level meant there were fewer investigators assigned to general money laundering operations.

The FBI, for example, reduced the number of squads assigned to money laundering, transferring agents to anti-terrorist work.

ATTENTION DIVERTED

Moreover, as the U.S. financial system went into crisis last year, the Treasury Department, other federal banking agencies and state bank regulators focused on monitoring the stability of the financial system, weakening enforcement of money laundering crimes.

Turf wars are inevitable since more than a score of federal agencies and thousands of state, county and local officials and police are involved. Government officials have asked for bigger budgets and more manpower to battle money laundering, but this may not be the answer.

''Money laundering efforts are like anti-drug trafficking measures,'' said Jerry Haar, an expert on international trade and associate dean of international affairs and projects at Florida International University's College of Business Administration. ``There's only so much money around to hire police and build infrastructure. You can slow down money laundering, but you'll never be able to stamp it out.''

Source: The Miami Herald

BY JOSEPH A. MANN JR.

American anti-money-laundering officials racked up their biggest success to date when a British bank agreed to pay $350 million to the federal government and the Manhattan District Attorney's office earlier this year for violating federal and New York state laws.

Lloyds TSB Bank, an international bank based in the United Kingdom, in January agreed to forfeit the money after U.S. investigators found that it falsified information on electronic fund transfers from Iranian and Sudanese banks to U.S. banks.

The Lloyds penalty was a chilling reminder of the severe consequences facing violators of U.S. anti-money-laundering laws.

In this case, it was employees of the bank who found a way to avoid setting off alarms at U.S. banks, according to court documents.

Describing the Lloyds case at a recent conference in Hollywood organized by moneylaundering.com, Adam Kaufmann, bureau chief at the Manhattan District Attorney's Office, said his office began investigating Iran and Iranian banking about three years ago.

ALTERED TEXT

As the investigation unfolded, the DA's office and the Justice Department, working with the IRS and New York state banking officials, found that beginning in the mid-1990s, Lloyds' offices, primarily in the U.K., Tokyo and Dubai, altered the text of electronic messages that moved funds from banks in Iran and Sudan to Lloyds and then to correspondent banks in the U.S.

The alterations, called ''stripping,'' involved removing any references to Iran, Sudan or any other terms that might raise a red flag at U.S. banks. These actions by Lloyds bypassed money-laundering filters and violated the International Emergency Economic Powers Act, which bans exportation of services to Iran and Sudan without authorization. Lloyds also violated New York State penal law by falsifying business records, Kaufmann said.

U.S. financial institutions believed that the transfers originated at Lloyds, not at banks in Iran and Sudan, thus causing them to provide financial services that were banned.

DODGING FILTERS

In 2002, Lloyds sought to stop stripping transfer messages in its own offices and advised Iranian banks on how to format messages that would avoid filters established by the Treasury Department's Office of Foreign Assets Control, Kaufmann said.

Lloyds voluntarily terminated the Iranian transfers in 2004. Payments from Sudan were halted in 2007. Kaufmann noted that recipients of funds in the U.S. are still being investigated.

Between 2002 and 2005, transfers from Iranian banks through Lloyds that terminated in the U.S. totaled around $300 million, while Iranian transfers that entered the U.S. and then were sent to beneficiaries in other countries reached into the billions of dollars. Transfers from Sudanese banks between 2002 and 2007 totaled about $30 million.

DIFFERING OPINIONS

Why did Lloyds decide to engage in the deception? The Justice Department's Mia Levine, who prosecuted the case with Kaufmann, said apparently ''there was a difference of opinion within Lloyds as to whether the bank was subject to U.S. laws.'' Some bank employees responsible for administering Lloyds' anti-money-laundering program were concerned about the transfers from Iran and Sudan, but other employees weren't.

Ironically, some transfers from Iran to the U.S. are permissible, Levine added, but Lloyds didn't seek permission from U.S. authorities.

In announcing the settlement in January, the Justice Department and the Manhattan DA's office said Lloyds ''accepted and acknowledged responsibility for its criminal conduct'' and agreed to forfeit $350 million as part of deferred prosecution agreements. Lloyds has agreed to cooperate with law enforcement, fully comply with international anti-money-laundering standards and disclose information on past Iranian and Sudanese transactions.

If the bank complies with the terms, it won't be prosecuted.

Source: The Miami Herald

By MARTIN LUTHER OKETCH

The huge amounts of money handled by private forex bureaus could be a threat to the country and the region if foreign exchange rules are disregarded, the Bank of Uganda has warned.

In a meeting held in Kampala by forex bureaus and money remittance operators on April 30, the executive director of bank supervision at the Bank of Uganda, Justine Bagyenda, raised the alarm on possible money laundering and financial terrorism.

She said the laid-down guidelines should be adhered to as the country awaits the enactment of the Anti Money Laundering Law.

A survey by the EastAfrican reveals that many operators are not complying with Know Your Customer requirements and procedures drafted by the central bank.

These procedures were issued to all forex bureaus and money remitters in August 2003 to assist in combating the vice in Uganda’s financial sector.

Said Ms Bagyenda: “For instance, some of you are not undertaking due diligence to ensure that customer identification details for large transactions are provided.”

She added: “We have noted that 90 per cent of the operators do not capture the sources of and the purposes of foreign exchange.

“This is very dangerous as it is a possible avenue for money laundering. You should comply with the law on declaring sources and purposes of foreign exchange, and the ‘know your customer’ measures that are crucial to turn down illegally-acquired funds and prevent possible financing terrorism.”

Foreign exchange regulations require dealers to report to the Bank of Uganda the details of any individual selling amounts in excess of $5,000.

Privately run foreign currency exchange bureaus and money remittance outlets handled 30 percent of the net foreign exchange transactions in Uganda in 2008, but the regulators are concerned by increased laxity.

The Bank of Uganda says the forex bureau and money remittance sector has remained largely buoyant, with a total of 122 forex bureaus and 75 money remittance outlets.

But a few were not following operational procedures regarding identification of clients, leaving the country open to money laundering.

Ms Bagyenda said an increase was reported in the inflows and outflows of licensed money remittances in the country that stood at the equivalent of $226.01 million in inflows and $104.20 million in outflows, at the close of December 2008.

This was a tremendous improvement compared with $99.44 million and $40.59 million recorded inflows and outflows during 2007.

Statistics from the bank show that total purchases in the forex bureaus market increased from $1.2 billion at the end of December 2007 to $1.5 billion at the end of December 2008, while total sales increased from $1.3 billion to $1.6 billion over the same period.

It is due to this performance that the Bank of Uganda continues to recognise the crucial role played by forex bureaus and money remitters as partners in deepening the financial sector and fostering macroeconomic stability and growth in the country, Ms Bagyenda said.

She added that increased risk aversion by investors and the effects of the global recession were presenting significant macroeconomic challenges to Uganda’s financial system.

If the global recession is prolonged, Uganda could face reduced export earnings, a decline in foreign direct investments and reduced remittances, which would significantly reduce the banking system liquidity and exert pressure on exchange rates and debt service capacity.

Uganda’s forex bureaus and money remitters operate under the Foreign Exchange Act of 2004 and the Foreign Exchange Remitters Act 2006.

The two Acts provide for exchange of foreign currencies in Uganda and making of international payments and transfer of foreign exchange; and for other related and incidental matters.

Ms Bagyenda promised more rigorous inspections to ensure compliance with laws through off-site and on-site surveillance of forex bureaus and money remittance sector.

In a related development, the bank’s assistant director of non-bank financial institutions, Benedict Ssekabira, said Uganda and Kenya had started harmonising the supervision of forex bureaus.

Two Bank of Uganda officials were to be in Kenya from May 4-8 for an insight into on-site and cash audit operations, he said.

Likewise, CBK officials have been in Uganda for lessons on risk-based supervision of commercial banks and financial institutions. The visits were arranged by a committee of the East African Monetary Community, which is handling the East African Monetary Union.

The East Community Monetary Committee Affairs — under the umbrella of the five governors of central banks of Tanzania, Kenya, Uganda, Rwanda and Burundi — is trying to beat the 2012 target of fast-tracking the East African Monetary Union.

Source: The East African

The Bank of Tanzania (BoT) lacks adequate strategies to tackle terrorist funding and money laundering activities despite the existence of laws expressly prohibiting such activities in the country, it has been revealed.

According to the latest report of the Controller and Auditor General (CAG), the BoT is required to be particularly vigilant on issues related to both money laundering and terrorist funding.

Such extra-vigilance entails knowing the purpose of remittances made via local commercial banks and other financial institutions, the report specifies.

It notes that the Anti-Money Laundering Act of 2006 and its 2007 regulations give the central bank sufficient mandate to exercise its duties as a ’’regulatory authority, and at the same time as a reporting entity.’’

But the bank lacks comprehensive policies and procedures for its own use in carrying out this mandate, the report states.

’’Furthermore, the bank (BoT) has no comprehensive guidelines in place covering all of the relevant areas of the bank, including the directorate of banking, foreign exchange, bank branch operations and staff duties, government deposits monitoring, and other deposits monitoring,’’ it continues.

The CAG highlighted the need for the central bank to come up with integrated policies for tackling money laundering and monitoring terrorist funding movements.

Says the report: ’’This implies that in the absence of integrated internal BoT anti-money laundering policies cutting across directorates and departments, there are risks of the bank failing to effectively and efficiently execute its core obligation.’’

’’Therefore, the bank should develop a policy and procedures manual dealing with money laundering.’’

The anti-money laundering legislation was set up to make better provisions for prevention and prohibition of money laundering activities in the country.

The law requires financial institutions and their customers to disclose information regarding money laundering.

The government subsequently established a Financial Intelligence Unit (FIU) and the national multi-disciplinary committee on money laundering.

Experts say money laundering activities have become quite rampant in Tanzania, with beneficiaries of proceeds from various fraudulent and corrupt deals usually stashing away their ill-gotten wealth in offshore bank accounts.

Money laundering activities have already been traced to a number of major scandals in the country, including the BoT’s external payment arrears (EPA) account embezzlement scam and the overpriced military radar deal.

Regarding terrorism, Tanzania was a victim of the 1998 US Embassy bombing in Dar es Salaam by Al Qaeda, and is still considered at risk from such terrorist activities, along with other countries in the East African region.

It has been reported that in the months following the September 11, 2001 attacks on the World Trade Centre and the Pentagon in the United States, the international community - led by the US - was able to freeze approximately $100m of terrorist funding.

Subsequent efforts over the next three years have failed to add much more than $40m to the total of frozen or confiscated funds.

Some of the reasons for this are traceable to the inherent inadequacies of global regimes designed to combat terrorist financing; others stem from the availability to terrorist networks of alternative methods of raising and moving money.

Yet others reflect the agility, flexibility, adaptability, and sheer ingenuity of terrorist networks that are not burdened with the constraints of sovereignty, not confined to the use of formal financial institutions, and not dependent on state sponsorship for their income.

Source: This Day

By James Langton

Financial services firms must not cut back on their efforts to fight money laundering despite the recession and the pressure to reduce expenses, regulators say.

Speaking to an information session on the fight against money laundering and terrorism financing in Toronto on Wednesday, Nicolas Burbidge, senior director, compliance division of the Office of the Superintendent of Financial Institutions, noted that the financial services industry has made progress in recent years against money laundering, but, he pointed out that “as cash has become harder to launder, criminals have become more creative in their efforts.”

Moreover, he noted that the financial crisis and the economic downturn have impacted the financial sector: “We understand the pressures on management to perform and to reduce expenses, but this should not occur at the expense of your anti-money laundering and anti-financing financing program. Your controls, and financial intelligence provided to FINTRAC, are critically important for the continued fight against financial crime, and the integrity of the Canadian and global financial systems.”

Burbidge said that “it is vital that Canada’s financial system continue to be seen as taking all the steps necessary to deter criminal elements that may seek to use the Canadian financial system for their own ends.”

That includes a commitment to the fight from the private sector.

Important changes were made to Canada’s anti-money laundering regime in 2008, he noted, but some firms haven't adopted all the necessary changes.

“Although many financial institutions have now developed adequate plans to implement these changes, other institutions are still lagging in some key areas. We have had to underline the need for these institutions to apply adequate resources, controls and procedures to ensure effective compliance can be achieved. We will continue to take action as needed in this area,” he said.

A requirement for financial institutions to develop an inherent risk methodology, which enables them to identify situations that are at higher risk for money laundering and terrorism financing, is one of the biggest changes Burbidge noted. And, he reported that OSFI’s work “indicates that many financial institutions, large and small, are challenged by this requirement.”

He added: “It is critical to the success of the risk-based approach in your AML/ATF program that the assessment of money laundering and terrorism financing risk gets done right. The required controls flow from the assessment of risk, and if risks are not adequately identified, then controls are likely to be weak.”

Source: Investment Executive

By Lisa Bryant

A French magistrate has decided to investigate claims that three African leaders invested millions of dollars in embezzled funds in property and other goods in France. The three leaders in question are Omar Bongo of Gabon, Denis Sassou-Nguesso of Republic of Congo and Teodoro Obiang of Equatorial Guinea.


The complaint against the leaders of Gabon, Republic of Congo and Equatorial Guinea was filed by corruption watchdog group Transparency International, last December. It is not the first such complaint against the leaders, but it is the first that investigating magistrate Francoise Desset has decided to take up.

Daniel Lebegue, president of Transparency International's French chapter, calls the decision significant.

"It's the first time our organization, Transparency International, is recognized by a judge to act vis-à-vis acting presidents or ministers - in this case African presidents - and the judge considers we are legitimate in doing so. So that's really a historical decision, opening new perspectives to fight against corruption ... and opening the way to recovering ... stolen assets by corrupt politicians, or ministers or heads of state," said Lebegue.

The prosecutor's office, which previously opposed taking the case, now has five days to appeal the decision. But, even if it does, the magistrate can still move forward in his probe.

Transparency International claims the three African leaders invested millions of dollars in luxury property, cars and other goods in France, using money that rightfully belonged to their people. President Omar Bongo, of Gabon, has already denied those charges.

However the case evolves, Transparency International's Lebegue says the magistrate's decision has given his group the legitimacy to press other claims against corrupt leaders, elsewhere in the world.

Source: VoA

by Mary Spicuzza

The U.S. Department of State has released its Country Reports on Terrorism 2008.

The country reports' western hemisphere overview, made public last week, praised Mexican President Felipe Calderón Hinojosa and his Administration for demonstrating "an unprecedented commitment to address national security concerns," but criticized Mexico's recent terrorist financing law for its lack of asset forfeiture provisions.

"In 2007, President Calderón signed into law legislation outlawing terrorist financing and associated money laundering. The new law established international terrorism and terrorist financing as serious criminal offenses, as called for in UN resolution 1373, and provides for up to 40-year prison sentences," it reads. "The measure also incorporated several non-finance related provisions including jail sentences for individuals who cover up the identities of terrorists and for those who recruit people to commit terrorist acts. While it lacked some important provisions, such as asset forfeiture measures, the law was a significant step forward."

Still, the State Department cited justice reform legislation that may include asset forfeiture authorities. And it commended Mexico's relationship with the U.S. in various law enforcement areas, including efforts to combat money laundering, terrorist financing and narcotics trafficking.

The Embassy of Mexico in Washington, D.C. did not return a call seeking comment.

Source: Asset Forfeiture Watch

A man has been ordered to forfeit more than £67,000 because he could not prove where the money came from.

Police found the cash at his house in Sandfields, Port Talbot, after reports of an attempted burglary there.

He was arrested on suspicion of money laundering and although never charged police have successfully applied to the courts for a confiscation order.

The man, who has not been named, said he saved up some of the money and made the rest selling military memorabilia.

But police instigated proceedings under the Proceeds of Crime Act (POCA) as he could not provide any legitimate source for the money.

A forfeiture hearing was held at Neath Magistrates Court on Friday.

Police said checks were made with HM Revenue and Customs, the Department for Work and Pensions and Neath Port Talbot council which further proved the cash was not earned legitimately.

Det Con Phil Davies, financial investigator for the division, said: "The onus was on the respondent to provide a lawful origin of the cash found in his possession.

"A legitimate source was not found and the cash was subsequently forfeited.

"Specific criminal conduct need not be proved.

"It is enough to show that the cash is probably related to one of a number of kinds of activity, any one of which would have been unlawful, for example, cheating the revenue, trading in counterfeit goods, drug supply or falsely claiming state benefits."

"The public can really help us by passing on any information about people who may be making a living off ill-gotten gains.

"Generally, these people are clearly seen to spend more than their apparent disposable income. This can include owning properties, expensive cars or having a social lifestyle beyond their means."

SOURCE: BBC

By Ivan Cairo
Caribbean Net News Suriname Correspondent

A former Suriname government minister was sentenced on Monday to serve a jail term for money-laundering. Siegfried Gilds, a former trade minister in the incumbent Venetiaan-administration, was also found guilty of bribing a witness and slapped with a cumulative jail term of 12 months for the two offences. He was found not guilty on the charge of being part of a criminal organisation.

Shortly after the verdict was read, Gilds, still claiming his innocence, told journalists he was "shocked" by the length of the sentence. Meanwhile, his attorneys have indicated that they will appeal the verdict. Gilds is the second ex-minister from the ruling New Front coalition led by President Ronald Venetiaan, who has been found guilty on criminal charges. On December 2008, former minister of Public Works, Dewanand Balesar was also slapped with a two-year jail term for corruption.

The court on Monday found that the ex-minister was guilty of laundering drug money on behalf of a relative in the Netherlands, by purchasing houses and developing real estate properties in Suriname between 2000-2005. That relative was sentenced in December 2005 to a two-year jail term on the same charges in the Netherlands.

Gilds' prosecution started in January 2006, when prosecutors here received information from the Dutch judicial authorities over his alleged involvement in money-laundering. According to the information that surfaced during the trial of his nephew in the Netherlands, the relative claimed that his uncle, Gilds, was his agent in Suriname and taking care of his financial and other businesses.

Ex-minister Gilds is chairman of the coalition Suriname Labour Party (SPA) and one of the four New Front leaders. He was appointed minister of Trade and Industry in September 2005, after the New Front coalition won the general elections of May 2005. In the previous cabinet (2000-2005) he held the post of minister of Justice and Police, while in the 80s and 90s he was appointed as minister of Labour and minister of Defence.

During his tenure as minister of Justice and Police, Gilds has strongly supported anti-money laundering activities of the government and championed anti-money laundering laws, which were passed in September 2002 by parliament.

Source: Caribbean Net News

The House of Representatives’ Commission III on law and human rights agreed on Monday to push deliberation of money laundering prevention and eradication bill as international pressure mounts for Indonesia to cooperate in efforts against the crime.

A working party will be set up to discuss the bill, which if approved, would replace a 2002 law. The new law would aim to boost the authority of the Financial Transaction and Report Analysis Center (PPATK) in dealing with money laundering cases.

Yunus Husein, PPATK’s head, said the existing law against money laundering did not meet international standards. Unlike in Malaysia, Singapore and Australia, for example, only entities dealing with financial issues such as banks, money changers, pension funds, insurance companies and post offices are mandated to report suspect transactions to the PPATK, he said.

Yunus said tainted money could enter business transactions involving property, jewelry and even through certain professions such as the law.

He hoped the House would speed up discussion of the bill, which the government submitted to the House three years ago.

He also said that several political parties had different drafts. One party, he said, opposed a proposal to give PPATK authority to tap a phone conversation, while another wanted to secure financial privacy in bank records.

Yunus said that he did not mind if PPATK were not given authority to tap phones as long as it still could access records from telephone providers or other law enforcers such as the police and the Corruption Eradication Commission (KPK).

“In the stock exchange, people manipulate trading, but we don’t know who controls the money and it would be hard to prove the transaction link without knowing about the conversation,” he said.

“If we want to know the link, we really need [to know about] the conversation, because money doesn’t talk,” Yunus said.

Andi Mattalatta, the Justice and Human Rights Minister and a Golkar Party member, said that while his party did not believe PPATK should have the authority to tap phone conversations, the Democratic Party believed this should be allowed.

Andi said a proposal from a House faction had asked for the removal of the word “prevention” from the bill’s title, leaving only “eradication,” but he said the term was needed as prevention was more effective in tackling money laundering.

“We still need prevention, because we can only save the state 10 percent if the case has already occurred,” the minister said.

Source: Jakarta Globe

By Luke Baker

Europe's top human rights body questioned Britain's commitment to fighting cybercrime and terrorism on Tuesday, asking why it had failed for more than four years to ratify key agreements.

The Council of Europe, which marks its 60th anniversary on Tuesday, expressed bafflement at Britain's failure to ratify three major conventions on cross-border crime, including one designed to combat the financing of terrorism.

In the case of cybercrime, not only has the convention been adopted by other leading European states, but also by the United States, which while not one of the Council of Europe's 47 members is still entitled to sign up to its conventions.

"What is disappointing is that the government of the United Kingdom have not yet ratified it," Terry Davis, the secretary general of the Council of Europe and a former British Labour Party politician, told Reuters in an interview.

"I find it very strange... By definition cybercrime is international. It's an international problem that requires an international solution."

The convention allows signatories to communicate with one another instantaneously when there is the suspicion of cybercrime being committed, and standardises offences across countries, increasing the likelihood of prosecution.

"I've never been given any satisfactory explanation of why it hasn't been ratified except that, well, it takes us time to do these things," Davis said, adding that he would be raising the issue with Britain's Minister of Justice, Jack Straw.

The convention on cybercrime was drawn up in November 2001 while the two other conventions, on the prevention of terrorism and on money-laundering, including the cross-border financing of terrorism, were introduced in May 2005.

"It's about recruitment of terrorists to commit acts of terrorism in other countries," Davis said of the anti-terrorism convention. "It's been open for ratification for four years now. Given that the UK is very concerned about terrorism, has direct experience of terrorism, I find it very strange."

Britain's Ministry of Justice and the Home Office (interior ministry) did not immediately respond to calls for comment.

While Britain has not ratified the cybercrime and terrorism agreements, it has ratified another on combating human trafficking, bringing it into force just last month.

HUMAN RIGHTS RECORD

As well as concern about Britain's slowness in signing up to international agreements, Davis rejected recent criticism by a senior British law lord of the European Court of Human Rights, a division of the Council of Europe.

Lord Leonard Hoffmann, Britain's second-highest law lord until his retirement last month, had suggested in a speech that the European Court of Human Rights was over-extending its jurisdiction, becoming akin to a Supreme Court of Europe.

The court rules on high-profile rights cases and has in the past overruled decisions handed down in Britain's top court.

"I have a great deal of admiration for Lord Hoffmann, but there were a number of things that were disappointing about his speech," said Davis.

"He gave the impression that he resented anybody overruling judges in the United Kingdom. That is to say that those people who have gone to the European Court of Human Rights and had judgments in the United Kingdom overruled by the court, that they should continue to suffer injustice.

"Is he saying that judges in the United Kingdom are supreme and cannot be questioned? That they cannot be checked?

"Twelve hundred years of legal history (in Britain) is no guarantee of justice," he said.

Source: Reuters

There is no proof of transfer of funds to terrorist groups through the Malaysian banking system, said Bank Nega-ra.

The central bank, in a press statement, refuted reports by a local English daily claiming that an individual with suspected links to al-Qaeda was transferring funds to terrorist groups from Malaysia.

“We would like to state that there is no evidence of such transfer of funds to terrorist groups through the Malaysian banking system,” it said yesterday.

Bank Negara said Malaysia’s banking system was subjected to ongoing surveillance and had not been tainted by such activities.

It added that it would continue to exercise vigilance against such threats which may arise from money laundering and terrorist-financing activities.

Source: The Star Online

The Council of Europe's Committee of experts on the evaluation of anti-money laundering measures and the financing of terrorism (MONEYVAL) is satisfied with the efforts made by the Ukrainian authorities to combat money laundering and the financing of terrorism, the press service of Ukraine's State Financial Monitoring Committee (SFMC) reported on Tuesday.

As SFMC Chief Ihor Cherkassky said, the assessment of Ukraine's achievements by the CE Committee has confirmed the considerable progress made by the Ukrainian state in that field.

"Ukraine has managed to create a really effective and modern system, which has become a reliable tool in fight against economic crimes," he said.

The report on Ukraine's anti-money laundering and combating the financing of terrorism covered the end of 2008. It was adopted by MONEYVAL at its 29th plenary meeting in Strasbourg on March 16-20, 2009.

The report sets out Ukraine's levels of compliance with the FATF [Financial Action Task Force] 40 plus 9 Recommendations. The evaluation also includes Ukraine's compliance with Directive 2005/60/EC of the European Parliament and of the Council of October 26, 2005, on the prevention of the use of the financial system for the purpose of money laundering and terrorist financing and the Commission Directive 2006/70/EC of August 1, 2006 laying down implementing measures for Directive 2005/60/EC of the European Parliament and of the Council as regards the definition of 'politically exposed person' and the technical criteria for simplified customer due diligence procedures and for exemption on grounds of a financial activity conducted on an occasional or very limited basis.

The experts highly estimated the performance of the appropriate structure of the Ukrainian financial intelligence, its high professional standards, which is the result of the financial intelligence departments' membership of international organizations. Currently, the SFMC is the full-fledged national center for collecting and analyzing information about suspicious financial operations.

Source: KyivPost

By Jithendra Antonio

Sri Lanka Bankers Association (Guarantee) Limited (SLBA) has recently called for Request For Proposals (RFP) to implement an Anti Money Laundering (AML) Software in member institutions. “Our main objective is to prevent anti money laundering activities and anti terrorist financing programmes” said Secretary General, SLBA Upali De Silva speaking to the Daily Financial Times.

He stressed that adoption on Anti Money Laundering technologies has become a global phenomenon as financial institutions around the world increasingly see the need to comply with regulatory measures on anti money laundering and anti terrorist financing programmes. He also said that the relevant legislation has already been passed and the Financial Intelligent Unit (FIU), a division of the Central Bank of Sri Lanka (CBSL), is charged with the administration of the provisions of relevant Parliament Acts. The Sri Lankan Bankers Association (SLBA) will coordinate implementation of AML Software among the member institutions as a facilitator” he said. Sri Lanka Bankers Association is a Guarantee company representing the interests of the Licensed Commercial Banks and larger Licensed Specialised Banks in Sri Lanka.

Secretary General SLBA Upali De Silva said that banks are required to submit any suspicious transaction that takes place in customer accounts and any nature of a large change in the financial accounts status of their customers to Central Bank, under the regulations. “If banks do not comply with these regulations and if they don’t query on such issues from relevant customers when the banks are questioned by Central Bank, even the Chief Executive Officer of the bank could end up in jail” Mr. De Silva added.“SLBA invites proposals from reputed experienced and eligible software service providers for the supply and implementation of an uniform software solution for banks to monitor, investigate and report transactions of a suspicious nature to the Financial Intelligence Unit at CBSL on priority basis, online” said Mr. De Silva. At the moment each and every bank operating in the country is required to submit details to Central Bank via in the form of data stored in compact disks on any nature of transactions that take place which exceed Rs.1 million in value. “This value was earlier Rs.500,000 and six months ago it was changed to Rs.1million since there are large number of transactions that take place in banks at the range of Rs.500,000 to Rs.1million.” explained Mr. De Silva.

According to SLBA the proposed software solution should contain modules on Know Your Customer Concepts, Transactions Monitoring, Entity Resolution, Compliance Reporting and Investigation Tools in order to enable banks to confirm to the requirements of Prevention of Money Laundering Act No. 5 of 2006, Convention on the Suppression of Terrorist Financing Act No. 25 of 2005, Financial Transaction Reporting Act No. 6 of 2006 and Minimum Standard Rules issued by the FIU in May 2007. “The overall cost of the AML Software implementation will be distributed among banks upon each and every bank’s volume of business after selecting a particular vendor” said Upali De Silva highlighting that after the system implementation the banks will be able to update relevant customer transaction informations online via a secure online environmental platform.

Interested parties could request for RFP document after making a non-refundable deposit of Rs. 50,000 by way of bank draft drawn on a bank in Colombo favouring SLBA (Guarantee) Limited from Monday April 27th 2009 4 pm to Monday May 11th 2009 either electronically via slab@sltnet.lk or by personal application or by post addressed to Secretary General of SLBA (Guarantee) Limited, Ceylinco House, 8th floor ,No: 69, Janadhipathi Mawatha, Colombo 01.

Source: Daily Mirror

The United States announced Thursday it has retained communist Cuba on a list of countries that allegedly support terrorism.

The State Department report lumping Cuba with Iran, Syria and Sudan was released weeks after US President Barack Obama made overtures to Havana, which is under a decades-old embargo, by lifting curbs on travel and money transfers.

Despite keeping Cuba on the blacklist, the report also highlighted positive steps taken by the government in Havana.

The report said "the Cuban government continued to provide safe haven to several terrorists," even if it "no longer actively supports" armed struggle beyond its shores.

It said members of the Basque separatist ETA, the Colombian rebel group FARC and the Colombian group ELN remained in Cuba last year after some arrived to help conduct peace negotiations with the governments of Spain and Colombia.

It also said that the government of President Raul Castro "continued to publicly defend the FARC," the Spanish acronym for the Revolutionary Armed Forces of Colombia.

But it noted that on July 6 last year former president Fidel Castro urged the FARC to release the hostages they were holding without preconditions.

And Castro "has also condemned the FARC's mistreatment of captives and of their abduction of civilian politicians who had no role in the armed conflict," it added.

It said that the United States had "no evidence of terrorist-related money laundering or terrorist financing activities in Cuba," but pointed out that Cuba's banking systems remain among the most secretive and opaque in the world.

It also said Havana still allowed members of US militant groups like the Boricua Popular, or Macheteros, and the Black Liberation Army to live on its territory, even though they were fugitives from US justice.

"In keeping with its public declaration, the government has not provided safe haven to any new US fugitives wanted for terrorism since 2006," it added.

Source: AFP