The Financial Action Task Force (FATF) and FATF-Style Regional Bodies(FSRBs)
The Financial Action Task Force (FATF) is an inter-governmental body whose purpose is the development and promotion of national and international policies to combat money laundering and terrorist financing. The FATF was created in 1989 and works to generate legislative and regulatory reforms in these areas. The FATF currently has 33 members, comprising 31 member countries and territories and two regional organizations, as follows: Argentina, Australia, Austria, Belgium, Brazil, Canada, Denmark, Finland, France, Germany, Greece, Hong Kong, Iceland, Ireland, Italy, Japan, Luxembourg, Mexico, Netherlands, New Zealand, Norway, Portugal, Russian Federation, Singapore, South Africa, Spain, Sweden, Switzerland, Turkey, United Kingdom, the United States, the European Commission and the Gulf Cooperation Council.
There are also a number of FATF-style regional bodies, which, in conjunction with the FATF, constitute an affiliated global network to combat money laundering and the financing of terrorism.
The Asia Pacific Group (APG) was officially established in February 1997 at the Fourth (and last) Asia/Pacific Money Laundering Symposium in Bangkok as an autonomous regional anti-money laundering body. The 32 APG members are as follows: Afghanistan, Australia, Bangladesh, Brunei Darussalam, Burma, Cambodia, Canada Chinese Taipei, Cook Islands, Fiji, Hong Kong India, Indonesia, Japan, Macau Malaysia, Marshall Islands, Mongolia, Nepal, New Zealand, Niue, Pakistan, Republic of Korea, Palau, Philippines, Samoa, Singapore, Sri Lanka, Thailand, Tonga, United States, and Vanuatu. Afghanistan, Burma and Canada became members at the APG July 2006 plenary in Manila.
The Caribbean Financial Action Task Force (CFATF) was established in 1992. CFATF has thirty members: Anguilla, Antigua & Barbuda, Aruba, Bahamas, Barbados, Belize, Bermuda, British Virgin Islands, Cayman Islands, Costa Rica, Dominica, Dominican Republic, El Salvador, Grenada, Guatemala, Guyana, Haiti, Honduras, Jamaica, Montserrat, Netherlands Antilles, Nicaragua, Panama, St. Kitts & Nevis, St. Lucia, St. Vincent & the Grenadines, Suriname, Trinidad & Tobago, Turks & Caicos Islands, and Venezuela.
The Eastern and South African Anti Money Laundering Group (ESAAMLG) was established in 1999. Fourteen countries comprise its membership: Botswana, Kenya, Lesotho, Malawi, Mauritius, Mozambique, Namibia, Seychelles, South Africa, Swaziland, Tanzania, Uganda, Zambia, and Zimbabwe.
The Eurasian Group on Combating Money Laundering and Financing of Terrorism (EAG) was established on October 6, 2004 and has seven members: Belarus, China, Kazakhstan, Kyrgyzstan, the Russian Federation, Uzbekistan, and Tajikistan.
The Financial Action Task Force on Money Laundering in South America (GAFISUD) was formally established on 8 December 2000 by the nine member states of Argentina, Bolivia, Brazil, Chile, Colombia, Ecuador, Paraguay, Peru and Uruguay. Mexico became the tenth member of GAFISUD in July, 2006.
The Groupe Inter-gouvernemental d'Action contre le Blanchiment en Afrique (GIABA) consists of 15 countries: Benin, Burkina Faso, Cape Verde, C�te d'Ivoire, Gambia, Ghana, Guinea Bissau, Guinea Conakry, Liberia, Mali, Niger, Nigeria, Senegal, Sierra Leone, and Togo.
The Middle East and North Africa Financial Action Task Force (MENAFATF) consists of 16 members: Algeria, Bahrain, Egypt, Jordan, Kuwait, Lebanon, Mauritania, Morocco, Oman, Qatar, Saudi Arabia, Sudan, Syria, Tunisia, United Arab Emirates, and Yemen.
The Egmont Group of Financial Intelligence Units
The Egmont Group began in 1995 as a collection of a small handful of entities, today referred to as financial intelligence units (FIUs), seeking to explore ways of cooperation among themselves. The FIU concept has grown over the years and is now an important component of the international community's approach to combating money laundering and terrorist financing. To meet the standards of Egmont membership an FIU must be a centralized unit within a nation or jurisdiction to detect criminal financial activity and ensure adherence to laws against financial crimes, including terrorist financing and money laundering. Since its inception in 1995 the Egmont Group has grown dramatically from 14 units to a recognized membership of 100 FIUs. The Egmont Group now has passed its first decade, and it is evolving toward a structure of independent units working closely together to strengthen not only their own countries' AML/CFT regime, but to strengthen the global firewall of economic resistance to money launderers and terrorist financiers.
The Egmont Group is an international network designed to improve interaction among FIUs in the areas of communications, information sharing, and training coordination. The goal of the Egmont Group is to provide a forum for FIUs around the world to improve support to their respective governments in the fight against money laundering, terrorist financing and other financial crimes. This support includes expanding and systematizing the exchange of financial intelligence information, improving expertise and capabilities of personnel employed by such organizations, and fostering better and more secure communication among FIUs through the application of technology. The Egmont Group's secure Internet system permits members to communicate with one another via secure e-mail, requesting and sharing case information as well as posting and assessing information regarding trends, analytical tools and technological developments. FinCEN, on behalf of the Egmont Group, maintains the Egmont Secure Web (ESW). Currently, there are 98 FIUs connected to the ESW.
The Egmont Group is organizationally structured to meet the challenges of the volume of membership and its workload. The Egmont Committee, a group of 14 members, is an intermediary group between the 100 Heads of member FIUs and the five Egmont Working Groups. This Committee addresses the administrative and operational issues facing Egmont and is comprised of seven permanent members and seven regional representatives based on continental groupings (i.e., Asia, Europe, the Americas, Africa and Oceania). In addition to the Committee there are five Working Groups: Legal, Operational, Training, Information Technology and Outreach. The Legal Working Group reviews the candidacy of potential members and handles all legal aspects and matters of principle within the Egmont Group. The Training Working Group looks at ways to communicate more effectively, identifies training opportunities for FIU personnel and examines new software applications that might facilitate analytical work. The Outreach Working Group concentrates on expanding and developing the FIU global network by identifying countries that have established or are establishing FIUs. Outreach is responsible for making initial contact with potential candidate FIUs, and conducts assessments to determine if an FIU is ready for Egmont membership. The Operational Working Group is designed to foster increased cooperation among the operational divisions of the member FIUs and coordinate the development of studies and typologies-using data collected by the FIUs-on a variety of subjects useful to law enforcement. The Information Technology (IT) Working Group promotes collaboration and information sharing on IT matters among the Egmont membership, in particular looking to increase the efficiency in the allocation of resources and technical assistance regarding IT systems. The Committee and the Working Groups meet at a minimum three times per year, including the annual plenary session.
To meet an ever-growing demand in terms of volume and complexity, the Egmont Group decided in June 2005 that a change was necessary to allow Egmont to meet its objectives and continue to grow and adapt to emerging trends. Consensual agreement by all Egmont members was reached for the creation of an Egmont Secretariat, the first step for Egmont to sustain, and more importantly enhance, its role in the global fight against money laundering and terrorist financing. With Egmont's input and expertise in increasing demand by other players on the global stage, the creation of the Secretariat will allow for consistent and active collaboration with other international organizations. The new Egmont Secretariat, to be located in Toronto, Canada, will begin setup and staffing by mid-2007, and is expected to be fully operational by 2008.
As of December 2006, the 100 members of the Egmont Group are Albania, Andorra, Anguilla, Antigua and Barbuda, Argentina, Aruba, Australia, Austria, Bahamas, Bahrain, Barbados, Belgium, Belize, Bermuda, Bolivia, Bosnia and Herzegovina, Brazil, British Virgin Islands, Bulgaria, Canada, Cayman Islands, Chile, Colombia, Cook Islands, Costa Rica, Croatia, Cyprus, Czech Republic, Denmark, Dominica, Egypt, El Salvador, Estonia, Finland, France, Georgia, Germany, Gibraltar, Greece, Grenada, Guatemala, Guernsey, Honduras, Hong Kong, Hungary, Iceland, Indonesia, Ireland, Isle of Man, Israel, Italy, Japan, Jersey, Latvia, Lebanon, Liechtenstein, Lithuania, Luxembourg, Macedonia, Malaysia, Malta, Marshall Islands, Mauritius, Mexico, Monaco, Montenegro, Netherlands, Netherlands Antilles, New Zealand, Norway, Panama, Paraguay, Peru, Philippines, Poland, Portugal, Qatar, Romania, Russia, San Marino, Serbia, Singapore, Slovakia, Slovenia, South Africa, South Korea, Spain, St. Kitts & Nevis, St. Vincent & the Grenadines, Sweden, Switzerland, Taiwan, Thailand, Turkey, Ukraine, United Arab Emirates, United Kingdom, United States, Vanuatu and Venezuela.
The Organization of American States Inter-American Drug Abuse Control Commission (OAS/CICAD) Group of Experts to Control Money Laundering
The Organization of American States Inter-American Drug Abuse Control Commission (OAS/CICAD) is responsible for combating illicit drugs and related crimes, including money laundering. In 2006, the commission carried out a variety of anti-money laundering and counterterrorist financing initiatives. These included amending model regulations for the hemisphere to include techniques to combat terrorist financing, developing a variety of associated training initiatives, and participating in a number of anti-money laundering/counterterrorism meetings. This work in the area of money laundering and financial crimes also figures prominently in CICAD�s Multilateral Evaluation Mechanism (MEM), which involves the participation of all 34 member states; beginning this year, however, the mechanism will use reports form the Financial Action Task Force (FATF), Caribbean Action Task Force (CFATF), and Financial Action Task Force of South America (GAFISUD) to prepare its evaluation.
CICAD's Group of Experts on Money Laundering met twice in 2006, first in Washington in May and later in El Salvador in November. This year's agenda included three primary themes-seizures, international funds, and financial remittances-and included special presentations by the OAS Secretary General, as well as by representatives of the United Nations, the Inter-American Development Bank (IDB), GAFISUD, the Government of Spain, the OAS Office of Legal Cooperation, and the Inter-American Committee against Terrorism (CICTE).
In his opening remarks during the first meeting the Secretary General proposed a CICAD assistance program to help member states provide funds to the Commission by each member state setting aside a small percentage (less than one percent) of revenue from seized assets. This revenue would support CICAD activities, such as specialized training. He reiterated the proposal at the OAS General Assembly in the Dominican Republic. The proposal will need to be considered further in terms of its voluntary nature and member states will need to consider whether they have legal authority to use seized assets in this manner.
Training and Technical Assistance
The Department if State Bureau of International Narcotics and Law Enforcement provided full or partial funding for many of the CICAD training programs conducted in 2006. Training efforts in money laundering control focused on judges, prosecutors, police officers, customs agents, the financial analysts and computer specialists of the financial intelligence units (FIUs), and compliance officers of financial institutions. Workshops for judges and prosecutors were held in the Dominican Republic, Honduras, Panama, Guatemala and Nicaragua. The courses were led by four international specialists (from Spain and Chile) as well as national experts. Subjects included, among others, money laundering doctrine, proof, international cooperation and special investigative techniques.
In a joint initiative with the United Nations and recently the IDB, mock trials were held in the Dominican Republic, El Salvador, Costa Rica and Chile. These exercises are based on real cases of money laundering and are aimed at judges, prosecutors and public defenders, as well as experts from financial intelligence units and the police who participated as witnesses in many cases.
"Train the trainer" training was also provided to law enforcement agents (police, customs, prosecutors) from Honduras, El Salvador, Nicaragua, Guatemala, Costa Rica, Panama, the Dominican Republic and Brazil. As part of the follow-up to the program, memoranda of understanding were signed with Uruguay, Bolivia, Paraguay and Peru, through which computer hardware was acquired so that the course could be replicated in each country.
With the assistance of the government of Spain and the participation of the United Nations Office on Drugs and Crime, CICAD carried out a pilot project to promote operations coordination among the police, financial intelligence units and prosecutors. A workshop, attended by Honduras, El Salvador, Nicaragua, Guatemala, Costa Rica, Panama, and the Dominican Republic, consisted of a mock investigation, based on real cases, during which agents from the institutions involved resolved a case of money laundering, and prepared the case for trial.
Technical assistance was focused on the establishment and development of financial intelligence units (FIUs) project. Beneficiaries were Costa Rica, El Salvador, Nicaragua, Panama, Honduras, the Dominican Republic, Uruguay, Ecuador and Colombia. The program, which was completed in December, provided assistance in the areas of staff training, organizational design, information system design, and technology acquisition. Staff participated in two regional workshops on basic tools for the analysis of financial information. In each of the countries, workshops included practical exercises in information analysis using computer software. In one of the sessions of these workshops, compliance officers from national financial institutions received special training to improve reports they submit to FIUs.
In the second half of 2006, the CICAD Anti-Money Laundering section began an ambitious new project for law enforcement agencies and prosecutors to develop a database classifying the many different types of money laundering, standardizing the terminology for describing each and cataloguing the real and potential law enforcement responses to detect, investigate and prosecute each type of money laundering. The database is being tested in workshops to explain its application. The first of these was held in Mexico on November 21-23, 2006.
Representatives participated in the following seminars, conferences and forums: GAFISUD, the first Meeting on Information Technology of the Financial Intelligence Units of South America, and the INTERPOL Group of Experts on Money Laundering. At the same time, contact was maintained with GAFISUD, CFATF, and the IMF to establish coordination for the programs and projects administered by these organizations.
Pacific Anti-Money Laundering Program (PALP)
The Pacific Islands Forum (PIF) was formed in 1971, and includes the 16 independent and self-governing Pacific Island countries: Australia, Cook Islands, Federated States of Micronesia, Fiji, Kiribati, Nauru, New Zealand, Niue, Palau, Papua New Guinea, Republic of the Marshall Islands, Samoa, Solomon Islands, Tonga, Tuvalu and Vanuatu. The United States cooperates closely with the PIF and participates in the annual Post-Forum Dialogue with the PIF and member-states.
The U.S. State Department's Bureau for International Narcotics and Law Enforcement Affairs contributed $1.5 million to the PIF to fund the first year of the Pacific Anti-Money Laundering Program (PALP)- a four-year program designed to develop viable anti-money laundering/ counterterrorist finance regimes in the fourteen non-FATF member states of the PIF. Full-time and intermittent residential mentors provide regional and bilateral training in all elements required to establish viable anti-money laundering/counterterrorist financing regimes that comport with international standards. PALP is committed to maximizing the institution-building benefits of its assistance by delivering it in both sequential and parallel steps. The steps, while tailored to each country's unique needs, include assistance in the following areas:
United Nations Global Programme Against Money Laundering
The United Nations is one of the most experienced global providers of anti-money laundering (AML) training and technical assistance and, since 9-11, counterterrorist financing, training, and technical assistance. The United Nations Global Programme against Money Laundering (GPML), part of the United Nations Office on Drugs and Crime (UNODC), was established in 1997 to assist Member States to comply with the UN Conventions and other instruments that deal with money laundering and terrorist financing. These now include the United Nations Convention against Trafficking in Narcotics and Psychotropic Substances (the Vienna Convention), the United Nations International Convention for the Suppression of the Financing of Terrorism, the United Nations Convention against Transnational Organized Crime (the Palermo Convention), and the United Nations Convention against Corruption (the Merida Convention). On September 2006, the UN General Assembly adopted the United Nations Global Counter-Terrorism Strategy. The Plan of Action contained in the Strategy encourages the UNODC to help countries comply with international norms and standards and to enhance international cooperation in these areas. The GPML is the focal point for anti-money laundering within the UN system and a key player in strengthening efforts to counter the financing of terrorism efforts. The Programme provides technical assistance and training in the development of related legislation, infrastructure and skills, directly assisting Member States in the detection, seizure and confiscation of illicit proceeds. Since 2001, GPML's technical assistance work on countering the financing of terrorism has in fact also received priority. The GPML now incorporates a focus on counterterrorist financing (CTF) in all its technical assistance work. In 2006, the GPML provided training and long-term assistance in the development of viable anti-money laundering/counterterrorism regimes to more than fifty countries.
The Mentoring Programme
The GPML's Mentor Programme is one of the most successful and well-known activities of international AML/CTF technical assistance and training, and is increasingly serving as a model for other organizations' initiatives. It is one of the core activities of the GPML technical assistance program and is highly regarded by the AML/CTF community. The GPML's Mentor Programme has key advantages over more traditional forms of technical assistance. First, Mentors serve as residential advisors in a country or region for as long as one to four years and offer sustained skills and knowledge transfer. Second, mentoring constitutes a unique form of flexible, ongoing needs assessment, where the mentor can pinpoint specific needs over a period of months, and adjust his/her work plan to target assistance that responds to those needs. Third, the Member State has access to an "on-call" resource to provide advice on real cases and problems as they arise. Fourth, a mentor can facilitate access to foreign counterparts for international cooperation and mutual legal assistance at the operational level by using his/her contacts to act as a bridge to the international community.
The GPML Mentoring Programme provides targeted on-the-job training that adapts international standards to specific local/national situations, rather then the traditional training seminar. The concept originated in response to repeated requests from Member States for longer-term international assistance in this technically demanding and rapidly evolving field. The GPML provides experienced prosecutors and law enforcement personnel who work side-by-side with their counterparts in a target country for several months at a time on daily operational matters to help develop capacity. Some advise governments on legislation and policy, while others focus on operating procedures, either with law enforcement or with issues relating to country's FIU. By giving in-depth support upon request, the mentors have gained the confidence of the recipient institutions, which enables the achievement of concrete and significant outputs.
In 2006, a GPML prosecutorial mentor was placed in the Prosecutor General's Office of Namibia, providing assistance for the development of asset forfeiture mechanisms in Botswana, Namibia, Zambia and Zimbabwe. The Mentor provided legal inputs to amend relevant legislation in each country, specifically the AML regulations pursuant to the Proceeds of Crime Act of Namibia and the Proceeds of Serious Crime Act 1990 in Botswana. He also completed analysis of respective asset confiscation programmes.
The UN mentor based in Tanzania with the Secretariat of the Eastern and Southern Africa Anti-Money Laundering Group (ESAAMLG) delivered training to 14 countries and assisted the ESAAMLG Secretariat in conducting the first ESAAMLG Developmental Strategic Implementation (DSI), a technical assistance needs analysis exercise in Lesotho in July. GPML placed a dedicated law enforcement advisor in Kenya to assist building financial investigation capacity for Ethiopia, Eritrea, Kenya, Tanzania and Uganda. A capacity enhancement workshop on financial investigations techniques for Kenyan law enforcement officials was conducted in November 2006. The Advisor together with the UN Mentor to ESAAMLG also delivered an AML/CFT awareness- raising seminar for the financial sector in Ethiopia and completed an AML/CFT needs assessment mission in that country. In collaboration with the World Bank and the U.S. Department of State, the GPML extended the appointment for a regional mentor for Central Asia in Almaty, Kazakhstan focusing on legislative assistance and FIU development, as well as an AML/CFT mentor in Hanoi, Vietnam to provide assistance to Vietnam, Lao PDR and Cambodia in the field of financial investigations and the overall development of viable AML/CTF regimes. In January, a law enforcement advisor for the Middle East and North Africa based in UNODC Field Office in Cairo started to provide technical assistance including legislative drafting and to conduct needs assessment missions. Mentors and experts supported the development of the legal, administrative, analytical and international co-operation capacity of other national governments. In addition, the GPML assisted in legislative drafting for many countries, including Yemen, Ghana, Kazakhstan, Kyrgyzstan Tajikistan and the countries of the West African Economic and Monetary Union. The GPML conducted a workshop on AML/CTF for prosecutors in Central and Eastern Europe, jointly organized with the OSCE in September.
Mentoring & Financial Intelligence Units
The GPML was among the first technical assistance providers to recognize the importance of countries' creating a financial intelligence capacity, and GPML mentors worked extensively with the development and the implementation phases of FIUs in several countries in the Eastern Caribbean, the Pacific and, most recently southeast Asia. Mentors working with FIUs, upon request of a Member State, will return to provide additional assistance to a country's FIU, as will likely occur for a six-month period in 2007 or 2008 with the FIU in Manila. The development of FIUs in the Eastern Caribbean played a key role in the removal of many of the jurisdictions being removed from the FATF Non-Cooperative and Countries and Territories list.
An FIU intermittent mentor provided assistance to emerging FIUs in Africa and the Caucasus, including a "train-the-trainers" program for law enforcement, the FIU, and prosecutors in Armenia.
A major initiative that may have global implications for many FIUs, is an ongoing initiative with UNODC IT Section that with the GPML has been working towards the development of a suspicious transactions reporting software package, GoAML, for potential deployment in FIUs that will soon be field-tested with the Nigerian FIU.
Computer Based Training
Other highlights of GPML's work in 2006 included the ongoing development of its global computer-based training (CBT) initiative. The program provides 12 hours of interactive basic AML training for global delivery. Delivery continued in the Pacific, Central American, and Western Africa regions. CBT training classrooms were established in Dakar, Senegal at the financial intelligence unit (CENTIF) and the Police College as well as in classrooms in ten Caribbean jurisdictions. The GPML piloted CBT in multiple locations throughout Africa, Middle East and North Africa, Central Asia, and Latin America, and developed and piloted new language versions including Spanish, Amharic, Arabic and Russian.
The training program has flexibility in terms of language, level of expertise, target audience, and theme. Computer-based training is particularly applicable in countries and regions with limited resources and law enforcement skills as it can be used for a sustained period of time. As an approach, CBT lends itself well to the GPML's global technical assistance operations.
In response to countries' concerns about the difficulties of implementing AML/CTF policies in cash-based economies, and the prevalence in some regions of cash couriers, the GPML is working toward the development of CBT modules to address AML/CFT requirements in a cash-based context.
Other GPML Initiatives
GPML contributed to the delivery of mock trials in Central and South America. This tailor-made activity was developed in response to repeated requests from Member States for practical realistic AML training. It combines training and practical aspects of the judicial work into one capacity building exercise. In 2006, the GPML, in a collaborative effort with the IMF, completed the revision of a model law on AML/CFT for civil law countries, encompassing worldwide AML/CFT standards and taking into account best legal practices. The GPML continued to work closely with the U.S. Department of Justice, U.S Treasury's Office of Technical Assistance (OTA) and the Organization for Security and Cooperation in Europe (OSCE) to deliver CTF training, particularly in the regions of Central Asia region, Southern Europe and Africa.
The GPML administers the Anti-Money Laundering International Database (AMLID) on the International Money Laundering Information Network (IMoLIN), an online, password-restricted analytical database of national AML/CFT legislation that is available only to public officials. The GPML also maintains an online AML/CTF legal library. IMoLIN (www.imolin.org) is a practical tool in daily use by government officials, law enforcement and lawyers. The Programme manages and constantly updates this database on behalf of the UN and ten major international partners in the field of anti-money laundering/countering the financing of terrorism: the Asia/Pacific Group on Money Laundering (APG), the Caribbean Financial Action Task Force (CFATF), the Commonwealth Secretariat, the Council of Europe-MONEYVAL- the Eastern and Southern Africa Anti-Money Laundering Group (ESAAMLG), the Eurasian Group (EAG), the Financial Action Task Force (FATF), Interpol, The Financial Action Task Force of South America (GAFISUD) and the Organization of American States (OAS). In February 2006, the GPML launched the second round of legal analysis utilizing the recently revised AMLID questionnaire. In this regard, the database currently reflects thirty-six revised questionnaires under the second round of legal analysis and an additional fifteen questionnaires are in various stages of being finalized. The updated AMLID questionnaire reflects new money laundering trends and standards, and takes provisions related to terrorist financing and other new developments in to account, including the revised FATF recommendations.