Money laundering and the financing of terrorism: 19th report of session 2008-09, Vol. 1: ReportThis report calls on the UK Government to investigate how piracy and laundering the proceeds of crime contribute to the financing of terrorism. The Government is complacent regarding the possibility of a link between piracy and terrorism. Shipowners putting together ransom money must seek consent for the payment and disclose how much is being paid, to whom, and where. The fight against money laundering depends on banks and others providing reports of suspicious activities to the Serious Organised Crime Agency (SOCA). 200,000 entries are made on their ELMER database each year, there are now 1.5 million entries, and most are kept for 10 years even where there is no evidence that the suspicious activity was criminal. The Information Commissioner must investigate this. The Committee considers the cost and resource impact on banks and others in the private sector in making Suspicious Activity Reports (SARs) and the lack of feedback about their effectiveness. States must share information about the movement of money, especially information about suspicious bank accounts. The Warsaw Convention on Money Laundering and Terrorist Financing is the first comprehensive international treaty covering both the prevention of money laundering and the financing of terrorism. But the UK has yet to sign it, let alone ratify it. The Committee believe this is indefensible. They call on Ministers to set an urgent timetable for signature and ratification. The Committee also criticise the failure to implement the EU Framework Decision on mutual recognition of confiscation orders. |
Contents
Summary | 5 |
The Fora for International Cooperation | 11 |
EU Agreement with the United States | 17 |
Confiscation of the Proceeds of Crime | 25 |
The Private Regulated Sector | 31 |
Law Society estimate of costbenefit of SARS | 37 |
The Payment Services Directive | 43 |
Summary of Conclusions | 51 |
Call for Evidence | 57 |
Common terms and phrases
Action Task Force alternative remittance systems AML/CFT anti-money laundering asset sharing agreements bank bilateral civil recovery compliance confiscation orders Council of Europe counter-measures Counter-terrorism Coordinator criminal offence criminal property customer due diligence ensure Europol FATF Recommendations feedback Financial Action Task financial institutions Financial Intelligence Units financing of terrorism FIU.NET Forty Recommendations Framework Decision FSRB Hawala hawaladar HL Paper HM Treasury Home Office ICAEW implementation inquiry international cooperation laundering and terrorist law enforcement Law Society Lord measures Member money laundering money service businesses MONEYVAL mutual legal assistance oral evidence organised crime paragraph predicate offence private regulated sector private sector procedures proceeds of crime prosecution ransom ratify Regulation EC SARS Regime Secretariat Serious Organised Crime Sir James Sassoon SOCA Sub-Committee Supplementary memorandum Suspicious Activity Reports suspicious transactions Taliban terrorist financing Third Directive told United Kingdom United Nations Usama bin Laden Warsaw Convention