The 1988 UN Convention against Illicit Traffic in Narcotic Drugs and Psychotropic Substances recognized that money laundering was the power train of criminal enterprises engaged in drug trafficking, especially because they used global banking operations to exploit breaches in international laws and enforcement to mobilize their financial resources. This activity also extended the repercussions of criminal activity into countries that were not direct participants in the production, trafficking or abuse of illegal substances because the flow millions of dollars distorted local economies and corrupted government and banking officials. The treaty drafters stated that they were:
"…determined to deprive persons engaged in illicit traffic of the proceeds of their criminal activities and thereby eliminate their main incentive for so doing."
In 1998, the United Nations General Assembly Special Session (UNGASS) approved a Political Declaration and Action Plan against Money Laundering which provided more specific provisions on the issues involved. In addition, a framework of other international treaties and conventions underpinned this initiative:
The Financial Action Task Force on Money Laundering (FATF) is an international policy-making body on the issue. The G-7 Summit of 1989 created the FAFT and a year later it issued the Forty Recommendations on Money Laundering. Over the years, changes were made to reflect increased concern about international terrorism and other dynamics so the document is now called The FATF Recommendations: International Standards on Combating Money Laundering and the Financing of Terrorism and Proliferation (PDF, 1.7 mb).
The FATF currently has 34 members and has its headquarters in Paris, France. CICAD is a recognized FAFT international observer.
The Egmont Group is the coordinating body for the international group of financial intelligence units (FIUs). It was formed to promote and enhance international cooperation in anti-money laundering and counter-terrorist financing efforts. It is named after the Egmont Arenberg Palace in Brussels, where the founding members met in 1995. The Group, with a membership that has now grown to 116 FIUs or equivalent agencies, has recently established a permanent secretariat, located in Toronto, to support its work.
Periodically, member states must go through a formal review procedure established by the Egmont Group in order to be recognized as complying with the Egmont requirements for a FIU.
The International Money Laundering Information Network (IMoLIN) is an Internet-based network assisting governments, organizations and individuals in the fight against money laundering and the financing of terrorism. It has current listings of internatoinal norms, online references and links to other organizations.
Because of the nature of money laundering, inter-governmental coordination is crucial to keeping up with trends. CICAD’s Money Laundering Control Section has played a lead role in drafting model legislation and recommendations of good practices; setting up, equipping and training the staffs of financial intelligence units (FIUs) in all Member States in South and Central America; training judges, prosecutors and police investigators in prosecuting money laundering cases, and providing technical assistance.
CICAD’s Money Laundering Section also cooperates with the Inter-American Committee Against Terrorism (CICTE) by jointly holding workshops on the nature of money laundering practices in terrorism networks and how law enforcement can investigate these operations.
The Financial Action Task Force of South America (Grupo de Acción Financiera de Sudamérica, GAFISUD) has 10 members. Its country reports are available online. Its seminal document, the Buenos Aires Declaration of Money Laundering, emerged from the Ministerial Conference Concerning the Laundering of Proceeds and Instrumentalities of Crime (December 2, 1995).
The Caribbean Financial Action Task Force (CFATF) has 30 member states and includes some Central and South American countries. It started in 1990. The Kingston Declaration on Money Laundering was issued in November 1992.
Other relevant organizations include the Financial Crimes Enforcement Agency (FINCen) of the U.S. Department of Treasury.
updated on 7/24/2012 12:11:49 PM