Guidelines to fight money laundering<\/p>\n
Dadan Wijaksana, The Jakarta Post, Jakarta<\/p>\n
The country's antimoney-laundering task force issued on Friday
\nseveral guidelines for local financial institutions, both banks
\nand nonbanks, to help them identify and detect any suspicious
\nfinancial transactions.<\/p>\n
\"This white-collar crime is a serious problem that needs the
\nattention of the banking industry,\" Yunus Husein, the chairman of
\nthe Financial Transaction and Report Analysis Center (PPATK),
\nsaid at a media briefing.<\/p>\n
He did not elaborate as to the amount of money that might be
\ninvolved in money-laundering practices in the country. But the
\nfact that Indonesia has long been regarded as one of the world's
\nmost corrupt country could indicate the scope of the crime here.<\/p>\n
The existing antimoney-laundering law defines the practice as
\nconverting money generated from corruption, bribery, smuggling,
\nbanking-related crimes, drug-related crimes, human trafficking,
\ngambling and terrorism into legal investments.<\/p>\n
Reports have said that worldwide, the funds alleged to have
\nbeen part of money-laundering networks reaches about 2 percent to
\n5 percent of the world's gross domestic product, which stands at
\nabout US$600 billion.<\/p>\n
Yunus added that widespread money-laundering practices could
\ncreate distortion within the country's financial system.<\/p>\n
According to the guidelines, financial institutions have to
\ntrain their employees to be able to detect suspicious financial
\ntransactions.<\/p>\n
It also outlines some tricks that are often used by money
\nlaunderers to convert their illegally-amassed funds into legal
\ninvestments. It is expected that banks and other financial
\ninstitutions would be more familiar with the tactics, and are
\nmore able to detect suspicious transactions as early as possible.<\/p>\n
Yunus acknowledged that the move was part of efforts to
\nintensify its campaign against money-laundering in the country,
\nwhich has been regarded by some as a safe haven for money-
\nlaundering activities due to its lax regulations.<\/p>\n
The country enacted the Law on Money Laundering last year, but
\nthe government is preparing a draft to amend the law to make it
\nmore suitable to international standards.<\/p>\n
The amendment is needed as a prerequisite for being taken off
\na list of nations billed as noncooperative in the world's fight
\nagainst money laundering. Failure to do so would put the banking
\nindustry at great risk of getting slapped with countermeasures
\nfrom the Financial Action Task Force (FATF), an international
\ngrouping of antimoney-laundering bodies.<\/p>\n
The countermeasures include a warning for multinational
\ncorporations to stay away from doing business in the blacklisted
\ncountry and forcing banks to collect detailed data before
\nconducting transactions with individuals or firms in that
\ncountry.<\/p>\n
Although there are plenty of modi operandi, money laundering can
\nbe broken down into three major steps:<\/p>\n
1. Placement: Putting funds that are generated illegally into a
\ncountry's financial system. This maneuver can be carried out in
\nthe form of:<\/p>\n
- Applying for credit at a bank, in which the payments to be made
\nare with illegal funds<\/p>\n
- Smuggling cash between countries<\/p>\n
- Providing financing for legitimate businesses through banks,
\ninvestment firms, etc.<\/p>\n
- Buying prestigious gifts through banks<\/p>\n
2. Layering: A process of covering up illegally generated funds
\nthrough various stages of transactions. The maneuvers are:<\/p>\n
- Transferring funds between banks in a country or between
\ncountries through a number of quick transactions<\/p>\n
- The use of cash deposits as collateral to support legitimate
\ntransactions<\/p>\n
- Moving funds between countries through a legitimate business
\nnetwork or a shell company<\/p>\n
3. Integration: The use of illegal funds that have successfully
\nentered a country's financial system for both legal and illegal
\nbusinesses. The common maneuver in this category is selling their
\nillegal fortune, which has been laundered, to a fellow money
\nlaunderer.<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/guidelines-to-fight-money-laundering-1447893297",
"image": ""
},
"sponsor": "Okusi Associates",
"sponsor_url": "https:\/\/okusiassociates.com"
}