BI issues new ruling on money laundering
BI issues new ruling on money laundering
JAKARTA (JP): Bank Indonesia has issued a new ruling to help
curb money laundering activity, the central bank deputy governor
Achjar Iljas said on Tuesday.
Achjar said that the "know your customers" regulation provided
guidelines for banks to detect suspicious transactions and
banking practices often used in the recycling of ill-gotten money
from criminal activity.
"With the (new) regulation, banks are expected to be able to
detect suspicious transactions," Achjar told reporters on the
sidelines of a hearing between Bank Indonesia and the House of
Representatives Commission IX on state budget and finance.
He added that the new ruling was issued on June 18 but was
disclosed only on Tuesday. He did not provide details.
A Bank Indonesia public relations official said that the
central bank would hold a news briefing on the new regulation on
Wednesday.
The Financial Action Task Force (FATF), which was formed by 29
developed countries in 1989 to fight international money
laundering activity, last week added Indonesia to its blacklist
of countries considered uncooperative in the crusade against
money laundering.
Coordinating Minister for the Economy Burhanuddin Abdullah
seemed unaware that the regulation to curb money laundering had
been issued.
Responding to the FATF warning on Indonesia, Burhanuddin told
reporters last Friday that the government would cooperate fully
in the global drive against money laundering.
He said that in addition to the bill to counter money
laundering, which was proposed recently to the House of
Representatives for deliberation, the central bank would soon
issue a new ruling to curb money laundering.
Burhanuddin said that failure to cooperate in the fight
against money laundering would further damage the country's
relations with the international community.
Retaliatory steps that FATF member governments might take
against the blacklisted countries include: warning multinational
corporations against doing business in those countries; forcing
banks to collect detailed information before conducting
transactions with citizens or companies in those countries and
making it more difficult for banks based in those countries to
operate overseas.
Money laundering is the practice of converting ill-gotten
wealth, mostly obtained from drug trafficking, into legal
investments, particularly in developing nations that lack
measures to detect and prevent it.
There has been speculation that some ill-gotten money from
international organized crime may have entered Indonesia in the
form of legal foreign investment via a complex money laundering
process.
Indonesia's lack of exchange controls, and the strong appetite
for foreign investment amid conditions of low saving and
investment are seen as being among the factors encouraging money
laundering in the country. (rei)