Indonesia added to moneylaundering blacklist
Indonesia added to moneylaundering blacklist
PARIS (Agencies): Industrialized nations added Indonesia to a
money laundering blacklist on Friday, thereby putting
international financial transactions with that country under a
tougher scrutiny.
The blacklist, issued here by the Financial Action Task Force
on money laundering, includes governments that don't cooperate
with international money-laundering efforts.
The Indonesian government proposed money-laundering
legislation to the House of Representatives in Jakarta only early
this week.
Indonesia and five other countries, which were entered into
the list on Friday--Myanmar, Guatemala, Hungary, Nigeria and
Egypt-- will face increased scrutiny from the task force, whose
31 members include the world's major economic powers.
The Financial Action Task Force is an international body
created to make it harder for criminals to move profits from
illegal activities through the banking system.
The task force said in a report that the U.S., Japan, Germany
and other industrialized nations had also decided to tighten
controls on financial transactions with Russia, the Philippines
and the Pacific island nation of Nauru unless those governments
crack down on money laundering.
"Enhanced surveillance and reporting of financial transactions
and other relevant actions involving these jurisdictions are now
required," the Paris-based task force said in the report.
Among the retaliatory steps that task-force member governments
might take against the blacklisted countries: warning
multinational corporations away from 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.
The three governments, listed as the most egregious offenders,
immediately defended their records and stressed their opposition
to money laundering. Russia has recently ratified a money-
laundering agreement, introduced legislation to combat the
practice and created a special money-laundering unit in the
Ministry of Finance, said Yuri Zubarev, press secretary at the
Russian Embassy in Washington.
"There are practical steps being taken," he said. "Whether
it's enough or not, we're doing what is possible."
The governments of both the Philippines and Nauru have also
proposed money-laundering legislation.
"We are taking aggressive action to curb, if not totally
eliminate, money laundering," said Patricia Paez, spokeswoman for
the Embassy of the Philippines in Washington.
The task force cited several countries blacklisted last year
that remain on the list this year, but have improved their money-
laundering enforcement, including Israel and Lebanon. The
Bahamas, Cayman Islands, Liechtenstein and Panama were removed
from the blacklist entirely.
The decision to penalize Russia and the Philippines, in
particular, assuaged some European concerns about whether the
Bush administration would endorse a joint approach to money
laundering. The administration in recent months has moved to
weaken a coordinated campaign against offshore tax havens and has
launched an internal review of domestic money-laundering rules.
"We fully support the FATF efforts to fight money laundering,"
said a Treasury Department spokeswoman, who declined to comment
on the specific task-force recommendations. The review of
domestic laws comes "in light of the fact that customs seizures
haven't increased and convictions haven't increased," she said.
A French official said that Europeans had gone into this
week's task-force meetings worried that the U.S. would insist on
reviewing the entire money-laundering initiative. "We see
productive discussions with the U.S., but there are still a
number of fundamental issues to be clarified," with regard to the
U.S. approach to both tax havens and money laundering, said Caio
Koch-Weser, Germany's deputy finance minister.