Global bodies such as the World Bank have accused GCC countries of overlooking the menace of money laundering, and the governments in the region are more serious than ever to curtail the menace.
Most of the tax free countries in the world face issues of illegal currency transactions due to a relaxed trading atmosphere and lack of accountability. However, the onus is now on this region as expatriates are a significant factor in the GCC economies, and there have been instances where funds were transferred to Islamic extremist organizations.
However, a key regional anti-fraud organisation praises the UAE for tackling financial malpractices.
The Mena Financial Action Task Force (MENAFATF) met in Manama, Bahrain, on June 18 for its 19th annual summit, where it recognised the UAE and Qatar for setting up and implementing anti-money laundering (AML) frameworks.
All 18 countries that attended the annual event are working on establishing AML measures in their respective territories.
In the UAE the government is tackling this issue; the existing AML law was amended in April 2014 and is now called The Anti-money Laundering and Combating the Financing of Terrorism Law.
“The addition of ‘financing of terrorism’ covers the area the committee is trying to combat. Other countries use the same definition, therefore it is official and well known,” says Ali Al Nuaimi from the UAE Financial and Economic Affairs Committee.
The Middle East and North Africa is under scrutiny after the World Bank, the United Nations and Interpol conducted a joint investigation on the transit zones of Somali piracy money.
Meanwhile, Qatar, which has been monitoring its business sectors following the establishment of its AML law in 2010, also received commendation at the summit.
“We welcome MENAFATF’s recognition of Qatar’s significant progress. We remain determined and focused to ensure that our AML framework continues to meet the highest standards,” says Sheikh Fahad bin Faisal Al Thani, deputy governor at Qatar Central Bank. “Qatari authorities continue to work collaboratively with international agencies to ensure its AML legal and regulatory framework aligns with international ‘best practice’.”
The Qatari government will soon announce a national action plan aimed at eradicating money laundering in the country.