Money Laundering

HC Deb 08 July 1992 vol 211 cc217-8W

Mr. Burns

To ask the Chancellor of the Exchequer if he will make a statement about the work of the financial action task force on money laundering.

Mr. Nelson

The financial action task force on money laundering (FATF) published its third annual report on 25 June. The FATF has focused on three key areas of work over the last year. It has reviewed the 40 recommendations that were drawn up in 1990 in the light of recent experience and developments in money laundering techniques. It has produced interpretative notes on matters such as unlawful use of shell companies and the use of lawyers as nominees for illegal entities. The FATF has also begun a study of ways to make it easier to track the movement of suspect funds through electronic payment systems.

The external relations working group of the FATF, chaired by the United Kingdom, has continued to encourage world wide action against money laundering, and has drawn up a detailed action programme for future work. Over the past year FATF members, including the United Kingdom, have taken part in a number of regional meetings to discuss money laundering including the Caribbean financial action task force in Kingston, Jamaica and the South East Asia Central bank board of governors in Jakarta. Links with other international organisations, such as the United Nations international drugs control programme and the Council of Europe are being developed.

Finally, the FATF has established an effective mutual evaluation programme to assess progress among its members in implementing the anti-money laundering measures that it has developed. Four of these in-depth country examinations have so far taken place. Australia, France, Sweden and the United Kingdom have been examined. The FATF report includes summaries of these assessments.

The report on the United Kingdom is very complimentary. It notes the scale and international nature of the United Kingdom financial sector and the importance we attach to its remaining clean. The report commends the co-operative nature of the United Kingdom response to the threat of money laundering, and the good relations between the financial institutions, the regulators and the law enforcement community. The report concludes that the United Kingdom approach to combating money laundering could serve as a model for other countries.

I have arranged for copies of the report to be placed in the Library.