He said the organization has been giving utmost importance to regulations to fight money laundering and terrorism funding during the past five years. Such regulations were essential in the wake of modern financial and banking systems that facilitate transfer and payment of money.
“Quick completion of trade deals and presence of indirect financial transactions without the actual presence of dealers pose a big danger as some people might use these facilities to achieve their illegitimate objectives,” the governor said.
The SAMA chief said the international community has been giving utmost importance to combating money laundering crimes and terror funding in order to protect the global financial system and confront the challenges facing secure trade dealings.
“This conference came within the framework of international and regional efforts to fight money laundering,” the governor said. “A number of systems and regulations have been introduced to disclose economic crimes in advance and punish those involved in such crimes,” he pointed out.
Abdul Rahman Al-Khalaf, deputy governor for technical affairs, said the meeting came at a time when MENAFATF was about to complete the first phase of a review of joint efforts to combat money laundering.
“Our task force has completed the review of international standards followed by countries to combat money laundering crimes and issued its new recommendations for the purpose,” he said.
MENAFATF was formed to build an effective system to combat money laundering and terrorism financing in the region. The efforts of the group are focused on the study of typologies and cooperation with international organizations concerned with combating money laundering.
Based in Bahrain, its members include Algeria, Egypt, Iraq, Jordan, Kuwait, Lebanon, Libya, Mauritania, Morocco, Oman, Qatar, Saudi Arabia, Sudan, Syria, Tunisia, United Arab Emirates and Yemen.
According to International Monetary Fund experts, the volume of money laundered annually is 2 percent to 5 percent of the global GDP which was $ 72.5 trillion in the pre-crisis year 2007. Simple calculations show that between $ 1.45 trillion and $ 3.62 trillion was laundered in the world in 2007.
Money-laundering crimes are not obvious to the man in the street. However, anybody can become a victim of financial fraud such as Ponzi schemes, bank card fraud, illegal foreign exchange dealings, deliberately engineered bankruptcies and forced takeovers of urban-forming enterprises. All of these are widespread forms of economic crimes that can affect anybody.
The result of such crimes are proceeds, usually in cash, which have to be "laundered" in order to make them look legitimate. Laundered proceeds of crime provide financial resources for organized crime and corruption and frequently are the main source of funding for extremist groups. The criminal economic system thriving on this basis damages the economy, undermines the country’s financial stability and lets organized crime establish control over the country’s economic system. Therefore, this phenomenon can be viewed as a threat to the economic and even national security of the country.
Money laundering creates serious obstacles for market transformations in all segments of public activity, disrupting the normal course of the economy and all core economic institutions, undermining the ability of government agencies to control and manage the country’s financial system.
Money laundering has spread on a scale where it can be a source of financial and economic disturbances for any country, while the damage from terrorist financing comes in the form of both financial losses and irreparable losses of thousands of human lives.
