International cooperation on Anti Money Laundering Measures

According to study by Lal Chand, money laundering and terrorist financing is a pillar of any country's national security and a strong financial system. It is nonan undertaking that requires the coordinated and dedicated efforts of policy makers, law enforcement, supervisors, and the private sector, particularly financial institutions. It is essential that we work closely together to develop and effectively implement strong laws and regulations to detect, deter, and disrupt illicit finance. Equally important is that we understand and communicate the money laundering and terrorist financing threats, vulnerabilities, and risks facing our country says Lal Chand in its study.

According to Law Analyst Lal Chand money laundering laws needs to be in line to international laws.  Another basic principle that guides the establishment of these best practices is that, in order to facilitate international co-operation in combating TBML/FT, countries could establish clear and effective gateways, subject to appropriate controls and safeguards and existing legal frameworks against money laundering says Lal Chand, to facilitate the prompt and effective exchange of trade data and other relevant information, on a case-by-case basis or as otherwise appropriate, among authorized counterparts. (Offshore Company Incorporation in Dubai is legal and you can legally avoid your taxes by the formation of an offshore company in Dubai but only through a sound and expert legal consultant who know's everything about its documentation and structures.) 

In line with this basic principle, countries are encouraged to provide the widest possible range of mutual legal assistance in money laundering investigations and prosecutions. This includes being able to share trade data and relevant financial information with other countries through the framework of mutual legal assistance in a timely, constructive and effective manner. Countries could also be able to co-operate in joint TBML/FT investigations. 

According to Lal Chand It is best practice in this area for countries to be able to share trade data directly to avoid money laundering says Lal Chand with their foreign counterparts (i.e. administrative assistance). Clear and effective gateways, mechanisms or channels that will facilitate such information exchange could be established. For example, the TTUs of some countries share a single database which allows them to manage and match trade data. This mechanism is further enhanced by having foreign liaison officers working within the TTU. Another, more common mechanism i in anti money laundering is a memorandum of understanding. Regional or international information exchange platforms for anti money laundering may also be used to facilitate the exchange of trade data (e.g. the Customs Information System in the European Union or the Egmont Group Secure Network of FIUs). Where the sharing of specific trade information with foreign counterparts is prohibited, countries are encouraged to share sanitized trade data. Countries may also wish to explore other data exchange models based on different levels of statistical aggregation. 

Legitimate trading activities for Anti Money laundering Activities

It is a basic Lal Chand anti money laundering principle that the above measures could be implemented with a view to ensuring that legitimate trading activities are not unreasonably hindered or obstructed. Consistent with this basic principle of anti money laundering standards, countries are encouraged to keep the following considerations in mind when implementing measures to combat TBML/FT: competitive neutrality, competition and economic efficiencies, the desirability of ensuring that regulatory considerations are addressed in a way that does not impose unnecessary financial and administrative burdens on reporting entities, and the risk that commercially sensitive information could be misused (i.e. for purposes other than combating TBMUFT). 

A review of the current practices of various jurisdictions shows that the following measures on anti money laundering laws can be implemented without hindering legitimate trading activities: 

• Applying an intelligence, risk-based and target-based approach which makes consistent use of TBML/FT red flag indicators. 

• Using data capture mechanisms such as Electronic Data Interchange (EDI), which is a set of standards for standardizing the structure of information to be electronically exchanged between authorities, from one computer system to another, without human intervention and subject to appropriate data protection safeguards. 

• Authorizing traders that meet certain criteria to benefit from facilitation for customs controls or simplifications for customs rules (e.g. Member states of the European Union recognize Authorized Economic Operator (AEO) status which is granted to traders that meet the following criteria: an appropriate record of customs compliance, satisfactory management systems that 

Ratification and implementation of UN instruments 
Countries should also immediately implement the United Nations resolutions relating to the prevention and suppression of the financing of terrorist acts, particularly United Nations Security Council Resolution 1373. Reporting suspicious transactions related to terrorism.

International Co-operation 

FATF Special Recommendations onMoney Laundering

Recognizing the vital importance of taking action  against money laundering  to combat the financing of terrorism, the FATF has agreed these Recommendations, which, when combined with the FATF Forty Recommendations on money laundering, set out the basic framework to detect, prevent and suppress the financing of terrorism and terrorist acts. 

Each country should take immediate steps to ratify and to implement fully the 1999 United Nations International Convention for the Suppression of the Financing of Terrorism.

II. Criminalizing the financing of terrorism and associated money laundering each country should criminalize the financing of terrorism, terrorist acts and terrorist organizations. Countries should ensure that such offenses are designated as money laundering predicate offenses. 

Freezing and confiscating terrorist assets 

Each country should implement measures to freeze without delay funds or other assets of terrorists, those who finance terrorism and terrorist organizations in accordance with the United Nations resolutions relating to the prevention and suppression of the financing of terrorist acts. 

Each country should also adopt and implement measures against money laundering, including legislative ones, which would enable the competent authorities to seize and confiscate property that is the proceeds of, or used in, or intended or allocated for use in, the financing of terrorism, terrorist acts or terrorist organizations. 

If financial institutions, or other businesses or entities subject to anti-money laundering obligations, suspect or have reasonable grounds to suspect that funds are linked or related to, or are to be used for terrorism, terrorist acts or by terrorist organizations, they should be required to report promptly their suspicions to the competent authorities. 

Each country should afford another country, on the basis of a treaty, arrangement or other mechanism for mutual legal assistance or information exchange, the greatest possible measure of assistance in connection with criminal, civil enforcement, and administrative investigations, inquiries and proceedings relating to the financing of terrorism, terrorist acts and terrorist organizations. Countries should also take all possible measures to ensure that they do not provide safe havens for individuals charged with the financing of terrorism, terrorist acts or terrorist organizations, and should have procedures in place to extradite, where possible, such individuals. 

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