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Article
Publication date: 1 April 1999

Valsamis Mitsilegas

This paper consists of two parts, the second of which will be published in the next issue of this Journal (Volume 3, Number 3). The second part of this paper will deal…

Abstract

This paper consists of two parts, the second of which will be published in the next issue of this Journal (Volume 3, Number 3). The second part of this paper will deal with the legal framework of the European Union.

Details

Journal of Money Laundering Control, vol. 3 no. 2
Type: Research Article
ISSN: 1368-5201

Article
Publication date: 23 August 2021

Hussain Syed Gowhor

This paper aims to inform the readers about the existing financial intelligence tools that are being used by financial intelligence units. It tries to demonstrate, with…

Abstract

Purpose

This paper aims to inform the readers about the existing financial intelligence tools that are being used by financial intelligence units. It tries to demonstrate, with the help of a literature review, what the limitations of these tools are and how these limitations hinder the potential of the financial intelligence tools for early detection of terrorist financing activities.

Design/methodology/approach

The literature review method was adopted to discuss the financial intelligence tools, their limitations and the implications of the limitations for early detection of terrorist financing activities.

Findings

It was found that although the financial intelligence tools were introduced with a view to detect terrorist financing activities early, there are some inherent limitations of the tools relating to technical design features and operational procedures that hinder early detection of terrorist financing activities.

Research limitations/implications

The existing financial intelligence tools need to be repaired by removing the inherent limitations of the tools.

Practical implications

The financial intelligence units should take into cognizance the importance of early detection of terrorist financing activities for preventing terrorist attacks and need to redesign the existing tools in such a way that make these tools effective for early detection of terrorist financing activities.

Social implications

Peace will be established in society by preventing terrorist attacks through early detection of terrorist financing activities.

Originality/value

The originality of the paper lies in identifying the limitations of the existing financial intelligence tools for the early detection of terrorist financing activities.

Details

Journal of Money Laundering Control, vol. 25 no. 4
Type: Research Article
ISSN: 1368-5201

Keywords

Article
Publication date: 18 November 2020

Seyfettin Unal and Mehmet Altun

This study aims to examine how important the countering terrorism financing is in the fight against terrorism and to what extent does financial intelligence contribute…

Abstract

Purpose

This study aims to examine how important the countering terrorism financing is in the fight against terrorism and to what extent does financial intelligence contribute into this field.

Design/methodology/approach

To this end, to collect data, semi-structured interview method was conducted for 15 experts, including academicians, judges, security and intelligence officers who have specialised and been practising in the field of terrorism. Then, the data were analysed with the descriptive and systematic method.

Findings

The findings highlight that countering terrorism financing is indispensable in the scope of the combating terrorism; however, there are still much to be done in practice to achieve more success in this field. The results also suggest that the process requires more flexible and proactive approach with the help of an autonomous financial intelligence unit to be more efficient. Moreover, there must be better cooperation and coordination at both national and international levels. Furthermore, training more professionals from multidisciplinary backgrounds and raising awareness among the public and private sectors are found to be other key factors for effective combating of the system.

Originality/value

The research has been conducted on participants who mostly have been in fight against terrorism over 20 years who are aware of the early methods, as well as the recent ones both in theory and in practice. Their view is significant to understand the situation in combating financing of terrorism.

Details

Journal of Money Laundering Control, vol. 24 no. 3
Type: Research Article
ISSN: 1368-5201

Keywords

Article
Publication date: 25 October 2021

Oleg Reznik, Maryna Utkina and Olha Bondarenko

The purpose of the article is to analyze the notion of “financial intelligence (monitoring)” in the system of combating money laundering and compare foreign financial

Abstract

Purpose

The purpose of the article is to analyze the notion of “financial intelligence (monitoring)” in the system of combating money laundering and compare foreign financial intelligence units. Money laundering poses a systemic risk to the financial and economic spheres, as well as to the national security of all countries. Financial monitoring should be pointed out while analyzing the issue of overcoming and preventing money laundering. It serves as one of the most sovereign remedies in the system of counteracting money laundering to minimize and effectively combat organized criminality and money laundering. The high level of development of the shadow economy, corruption, ineffectiveness of regulatory and legal support, as well as duplication of functions of individual authorities have become prerequisites for the financial monitoring system formation.

Design/methodology/approach

The theoretical and legal principles of financial monitoring in the system of counteraction to money laundering using the system-structural method were analyzed. The application of this method allowed to systematize the basic provisions on financial monitoring and the principles of its implementation. The system-structural method was used combining with the method of terminological analysis and operationalization of concepts. This method was used to identify key problematic aspects of understanding the financial monitoring essence, the peculiarities of the scientific community views on the definition of “financial intelligence,” “financial intelligence unit.” The method of analysis and synthesis in their systemic combination, as well as the ascent from the abstract to the concrete, was directly used to determine the impact of money laundering on the financial and economic security of Ukraine in the context of globalization. The extrapolation method was used to determine the possibility of implementing the analyzed existing world experience in the domestic practice of financial monitoring as an effective way to combat money laundering. The method of creating a theory was used to generalize the results of the research, to find general patterns for the objects being studied. The comparative method was used for comprehensive comparative research.

Findings

The development of money laundering and terrorist financing is one of the main challenges facing each state in the context of financial globalization. This is because the owners of untaxed income are trying to give them a lawful origin. The so-termed “criminal proceeds” pose a threat not only to the economy of any state but also to the national system. In turn, the low level of the financial system controlling instrument is conducive to the accelerated criminally obtained income transfer, which leads to the development of the shadow economy.

Originality/value

The authors recognized the most appropriate interpretation of the term “money laundering.” This is the process of transforming illegally obtained income into legal, ie legal income. The purpose of such a transformation is to conceal the original source of “criminal proceeds” and eliminate their traces. However, it should also be emphasized that the term “money laundering” also applies to such financial transactions that form a certain asset as a result of “criminal acts” (in particular, corruption).

Details

Journal of Money Laundering Control, vol. ahead-of-print no. ahead-of-print
Type: Research Article
ISSN: 1368-5201

Keywords

Article
Publication date: 3 April 2020

Shirin Sultana

The purpose of this paper is to examine the effectiveness of the Financial Intelligence Unit (FIU) of Bangladesh and India in efforts of combating money laundering by…

Abstract

Purpose

The purpose of this paper is to examine the effectiveness of the Financial Intelligence Unit (FIU) of Bangladesh and India in efforts of combating money laundering by these countries through a comparative assessment of several aspects of both FIUs.

Design/methodology/approach

The two FIUs are compared by using a “multiple case design” method of assessment. The framework for assessment was developed following the earlier models developed by scholars and recommendations of international institutions working on money laundering. Publicly available information from the respective websites of FIUs and annual reports has been used to complete the study.

Findings

The study has found that FIUs of both countries have improved significantly in fulfilling their mandates. There are several commonalities and differences between the two agencies. Despite showing improvement in several respects, both countries need to address certain basic deficiencies of the existing framework to make the agencies more effective.

Originality/value

It is supposed that this study will assist both countries to transform their existing FIUs to robust agencies in anti-money laundering efforts by taking care of the weaknesses identified here. It is hoped that the present study will encourage similar studies regarding the problematic areas of FIUs of Bangladesh and India as identified and in respect of FIUs of other countries.

Details

Journal of Money Laundering Control, vol. 23 no. 4
Type: Research Article
ISSN: 1368-5201

Keywords

Article
Publication date: 2 July 2019

Eugene E. Mniwasa

This paper aims to explore the role of the financial intelligence unit in Tanzania in fighting against money laundering and its predicate offences, examine its potential…

Abstract

Purpose

This paper aims to explore the role of the financial intelligence unit in Tanzania in fighting against money laundering and its predicate offences, examine its potential in controlling the problem and describe factors that undermine its efficacy.

Design/methodology/approach

The doctrinal research approach is used to analyse Tanzania’s anti-money laundering law and appraise its effectiveness in facilitating operations of the financial intelligence unit in fighting against money laundering and its predicate offences. The law-in-context approach is applied to interrogate the anti-money laundering law and describe non-law factors that impinge on the efficiency of Tanzania’s financial intelligence unit.

Findings

The law vests the financial intelligence unit with powers to perform a number of functions that are significant in fighting against money laundering and its predicate offences in Tanzania. The unit has been instrumental in curbing money laundering. The efficacy of this anti-money laundering agency, which is at its infancy stage, is emasculated by law-related, institutional and non-law factors. These factors undercut the potency of the agency.

Practical implications

There is a need for Tanzania to undertake policy, legislative and institutional reforms to augment the efficacy of the financial intelligence unit. The reforms should be implemented concurrently with other measures, which will enhance the country’s anti-money money laundering regime.

Originality/value

This paper applies the legal and non-law perspectives to evaluate the effectiveness of the financial intelligence unit as an essential component of Tanzania’s anti-money laundering regime. It proposes law-related and non-law approaches to augment the efficiency of the unit and the country’s anti-money laundering regime in general.

Details

Journal of Money Laundering Control, vol. 22 no. 3
Type: Research Article
ISSN: 1368-5201

Keywords

Article
Publication date: 2 July 2018

Mohammed Ahmad Naheem

The purpose of this paper is to share research data from the Financial Intelligence sector on trade-based money laundering (TBML), as a way to better inform banking risk…

26272

Abstract

Purpose

The purpose of this paper is to share research data from the Financial Intelligence sector on trade-based money laundering (TBML), as a way to better inform banking risk assessment and the submission of suspicious activity reports (SARs).

Design/methodology/approach

The research data formed part of a bigger project on TBML banking risk assessment for improving the detection of TBML activity. This paper analysed the data from an online survey carried out among the financial intelligence staff from financial intelligence units (FIUs) and some external financial intelligence agencies. The aim was to determine which areas of banking SARs needed to be improved or enhanced to support FIU investigations.

Findings

The research found that FIUs do use the data supplied to them, in particular the SARs. The research also found that more data would be appreciated from banks especially in relation to beneficial ownership information and politically exposed persons data. The findings highlighted that contact between banks and FIUs was limited and restricted to a couple of key individuals, whereas the increased requirement for intelligence and more data would suggest that this relationship needs to be expanded and strengthened.

Research limitations/implications

The main limitation was the restricted scope of the survey (only focussed on TBML) and was broad in depth, and perhaps a local FIU survey would be useful to look at specific country recommendations. Similar research also needs to be conducted on other forms of ML activity. The research identified the need for more information on beneficial ownership information; however, other work needs to be done on how exactly banks can access this data.

Practical implications

The main outcome from the research was the need for SARs to contain more detailed information on beneficial ownership and politically exposed persons data. This needs to be incorporated into a specific risk assessment tool for TBML that considers not only the client but also relevant business partners and silent partners/shell companies used by the client. This research is part of a bigger research project that has developed a risk matrix tool for TBML and can be linked into this work.

Originality/value

The paper used original data collected by the researcher from 49 FIU and financial intelligence staff across the globe. The timely presentation of the results and the nature of the sample means that this is relevant and useful data to be presented to the banking sector.

Article
Publication date: 7 October 2014

Clifford Williams

The purpose of this paper is to explain that the commonly used method allowing for inter-agency cooperation between national financial intelligence units, the memorandum…

Abstract

Purpose

The purpose of this paper is to explain that the commonly used method allowing for inter-agency cooperation between national financial intelligence units, the memorandum of understanding, is inadequate and ineffective in creating a cooperative global financial intelligence unit capable of combating money laundering typologies on an international scale.

Design/methodology/approach

Methods of international financial intelligence unit (FIU) cooperation have chiefly occurred in two ways: first, through the efforts of the Egmont Group; and second, through the inclusion of provisions concerning FIUs contained in international legal documents. The first is an impossibility.

Findings

This paper proposes that the result of implementation of the 2012 Financial Action Task Force Recommendations will be an informal network of FIUs where the Egmont group acts as a centralized operator for information exchange, effectively creating an informal global FIU (“GFIU”), but that this system, or a cooperative global financial intelligence unit system based on FIU-to-FIU exchanges will not allow for effective multilateral, international cooperation.

Research limitations/implications

This is because national interests and unfamiliarity with capabilities provided in the Egmont Group’s cooperative platform have and will continue to result in under-utilization of cooperative efforts, and because the traditional mechanism employed for FIU-to-FIU exchanges, the memorandum of understanding (“MOU”), makes uniform or standardized information request and transfer procedures that are required for multilateral or multi-agency efforts to combat money laundering across international boundaries an impossibility.

Practical implications

The Egmont Group’s cooperational structure should be the primary means by which to achieve a GFIU.

Social implications

The global combat on money laundering will be more effective, thereby more fully protecting the global economy.

Originality/value

A comparison between the Egmont Group’s network building mechanism and the existing use of MoU to create global cooperation against money laundering has not been analyzed.

Details

Journal of Money Laundering Control, vol. 17 no. 4
Type: Research Article
ISSN: 1368-5201

Keywords

Article
Publication date: 1 January 2012

Musonda Simwayi and Muhammed Haseed

The purpose of this paper is to present a comparative position of Financial Intelligence Units (FIU) in Zambia, Zimbabwe and Malawi and assess their role in combating…

2578

Abstract

Purpose

The purpose of this paper is to present a comparative position of Financial Intelligence Units (FIU) in Zambia, Zimbabwe and Malawi and assess their role in combating money laundering.

Design/methodology/approach

The study employed a multiple case study research methodology. The units in the three countries are compared using a framework based on the Financial Action Task Force (FATF) recommendations, the International Monetary Fund, the World Bank and Commonwealth guidelines and the Egmont Group guidelines.

Findings

The study established that the three countries have made tremendous progress in the fight against money laundering. The units in the three countries have several commonalities and differences. Zimbabwe is left behind in the process of establishing an effective FIU. Malawi is on top with Zambia coming second.

Research limitations/implications

Apart from the common limitations of the multiple case study methodology, the major limitation of this study was the utilization of secondary data in the case of Zimbabwe.

Practical implications

The practical implication of these findings is that policy makers and FIU authorities the world over would be particularly interested in regard to strengthening their units and comparing themselves with international standards.

Originality/value

By focusing on three countries the study has addressed weaknesses usually associated with single country case studies. These findings may be generalized without difficulties. It is envisaged that that research will encourage similar studies in other regions of the world.

Details

Journal of Money Laundering Control, vol. 15 no. 1
Type: Research Article
ISSN: 1368-5201

Keywords

Article
Publication date: 23 October 2007

Milind Sathye and Chris Patel

The purpose of this paper is to present a comparative position of the extent of commonality or diversity in the rationale, objectives, processes used and outcomes achieved…

1212

Abstract

Purpose

The purpose of this paper is to present a comparative position of the extent of commonality or diversity in the rationale, objectives, processes used and outcomes achieved by financial intelligence agencies in India and Australia. An effective financialintelligence unit (FIU) can make a significant contribution to combating serious financial crimes nationally and internationally.

Design/methodology/approach

The agencies in these two countries are compared using the framework for assessment of financial regulatory agencies – suitably modified to capture the specialist role of such agencies. Information available at the web site of the two agencies has been used.

Findings

The study shows several commonalities and differences in the financial intelligence agencies in the two countries and points to operational and policy changes required in making the units more effective.

Originality/value

It is hoped that the study would encourage similar studies in respect of other FIUs and help in contributing to making the global financialintelligence regime more robust.

Details

Journal of Money Laundering Control, vol. 10 no. 4
Type: Research Article
ISSN: 1368-5201

Keywords

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