Anti Money Laundering Blog

On August 26, 2008, Chinese investment company director Yang Shiming was sentenced to 9 years in jail and a fine of USD 728 571 for money laundering.

It should be noted that this case is the first of that kind in the province’s capital city of Chengdu that leads the country in terms of illicit money deals.

Besides Yang Shiming, the Sichuan Province court dealt with 15 defendants that were sentenced to a range of penalties from death with 2-year probation to 4-year imprisonment for their involvement in 8 fraud cases worth 240 million yuan.

A 2-day sensitization workshop organized by the Inter-Governmental Action Group Against Money Laundering in West Africa (GIABA) based in Dakar, Senegal, was held in Monrovia. At the workshop, the participants have advanced a number of recommendations.

The sensitization workshop was held under the theme “Enlisting the Support of the Liberian Media, Civil Society Organizations and Professional Groups for GIABA’s Strategic Action Plan to Combat Money Laundering and Terrorist Financing in Liberia.”

Some of the recommendations put forward at the workshop were as follows:

- The participants wanted the Government of Liberia to enact new laws on Money Laundering and Terrorist Financing in order to correspond to international standards and best practices.

- They recommended the Government of Liberia to pass the Anti-Drugs Law in order to help curb predicated offences that lead to Money Laundering and Terrorist Financing.

- The participants called on the Government to establish structures like a Financial Intelligence Unit (FIU) that will deal with fighting against Money Laundering and Terrorist Financing.

- They recommended to increase support (training, logistics and other technical supports) to law enforcement agencies.

- The participants called on the Government to improve the monitoring of the financial sector.

- They touched upon the roles of the media, civil society and professional groups in fighting Money Laundering and Terrorist Financing, recommending to establish stakeholder networks in order to enhance coordination, awareness and sensitization on impact of the problem in Liberia.

On August 7, 2008, the government of the Isle of Man provided an update on the tax and economic cooperation treaties that it has signed with the 7 members of the Nordic Council. These are Denmark, Norway, Sweden, Finland, Greenland, Iceland, and the Faroe Islands.

The authorities of the Isle of Man explained in a statement that the parliament ratified all of the agreements on March 12, 2008, and the Isle of Man Chief Minister, Tony Brown MHK, informed each of the Nordic Council countries about the ratification.

Chief Minister said that the appropriate notifications from Greenland and Finland have been received, and the agreements between the Isle of Man and Greenland came into effect on April 11, 2008 and the agreements between the Isle of Man and Finland came into effect on June 14 2008. Norway has notified the Isle of Man that it has completed its ratification procedures, so the agreements between the Isle of Man and Norway will come into effect on August 23, 2008.

According to the Chief Minister, the Government looks forward to receiving ratification notifications from other Nordic Council countries in due course.

On August 11, 2008, the State Secretary of Finance for the Netherlands Antilles, Alex Rosaria, asked the Tax Directorate of the European Commission to take the jurisdiction off tax haven blacklists in some European states.

He said that the Netherlands Antilles is offering a leading edge financial service industry with supervision that is in line with international standards of protecting the customer.

Mr. Rosaria noted that the Netherlands Antilles is an active and a complying member of various international organizations including the Financial Action Task Force (FATF), the Caribbean Financial Action Task Force (CFATF), the OECD, and the Egmont Group.

The OECD has recognized the Netherlands Antilles as a co-operative jurisdiction. In April 2008, the seal of approval was given to the Netherlands Antilles by the Egmont Group. In its most recent Article IV Consultation, the International Monetary Fund made a conclusion that “the financial sector of the Netherlands Antilles is broadly healthy”.

Also, according to Mr Rosaria, any reference to the Netherlands Antilles being a tax haven is misguided, contradictory and unjust as far as it it were a tax haven Spain would not have signed a Tax Information Exchange Treaty with  it in June 2008.

The central banks of Bangladesh and Malaysia are planning to seal a pact on sharing information as regards money laundering. The agreement will soon be signed by the Bangladesh Bank and Bank Negara Malaysia.

The central bank of Bangladesh also intends to sign similar agreements with some other countries including India.

Also, it wants to join the Egmont Group, an informal international gathering of financial intelligence units, in order to share information on money laundering and to fight money laundering and terrorist financing

Hong Kong’s regimes aimed at countering crime and terrorist-financing have been praised by two large international anti-money laundering groups – the Financial Action Task Force (FATF) on Money Laundering and the Asia/Pacific Group on Money Laundering (APG).

An evaluation report published on July 21, 2008 comprised the comments made by both the FATF and the APG. The report praised good legal structure of Hong Kong. It also praised this financial jurisdiction for its conviction rate for money laundering offenses, as well as strong law enforcement and clear-cut obligations for reporting suspicious transactions. According to the report, the Hong Kong’s supervisory regime as regards the banking industry, securities sector and insurance sector has proved effective with comprehensive obligations and various sanctions.

The report also noted that the establishment of the Central Co-ordinating Committee on Anti-Money Laundering & Counter Financing of Terrorism chaired by the Financial Secretary was also a good development for the jurisdiction.

In July, the Financial Supervision Commission of the Isle of Man announced that its Anti-Money Laundering and Countering the Financing of Terrorism Handbook has been published with the exception of Section 9.

As regards Section 9, it will be included into of the Anti-Money Laundering and Countering the Financing of Terrorism Handbook after it is drafted following with further industry consultation.

The Financial Supervision Commission announced that the new Handbook will come into effect on August 1, 2008 so that it corresponds with the coming into effect of Part 9 of the Financial Services Rule Book. According to the Commission, the Handbook will replace the Money Laundering and Prevention of Terrorism Guidance Notes (April 2003).