Calling the "U.S. commitment to combating money laundering at all levels of government outstanding," the Financial Action Task Force (FATF), the 26-nation organization created by the G-7 to address the global problem of money laundering, released a summary of its Mutual Evaluation of the U.S. today in Rome, Italy. The assessment of the U.S. effort to combat money laundering was included as part of the FATF’s yearly report which was disseminated at the conclusion of its annual meeting.
FATF is based in Paris and considered the world leader on anti-money laundering standards. It mandates mutual evaluations--regular, on-site peer-group examinations of each member nation’s progress in implementing anti-money laundering controls. "This positive evaluation that the United States received lends international credibility to U.S. anti-money laundering programs as well as further establishes U.S. leadership in countering money laundering worldwide," said Stanley E. Morris, Director of the U.S. Department of the Treasury’s Financial Crimes Enforcement Network (FinCEN). FinCEN leads the U.S. delegation to FATF and coordinated the mutual evaluation of the U.S.
The FATF assessment outlined the major steps the U.S. has taken to strengthen its anti-money laundering regime since its last evaluation in 1992. Noted advancements included:
- the introduction of a new suspicious activity reporting (SAR) system and more comprehensive civil safe harbor provisions;
- the modification of the currency transaction reporting system so as to reduce regulatory burdens on the U.S. banking industry by the expansion of exemptions, and the use of a simplified currency transaction reporting (CTR) forms;
- extending the list of money laundering predicate offenses to cover terrorism, health care and immigration offenses;
- improved cooperation between government and financial industry representatives in meeting anti-money laundering objectives through the establishment of various co-ordinatory groups;
- the implementation of Project Gateway which provides on-line financial intelligence to state and local government authorities;
- new funds transfer record keeping rules; and
- the efforts to encourage the states to enact laws and coordinate law enforcement and regulatory activity against money laundering.
The evaluators also determined that generally the U.S. money laundering offenses and forfeiture provisions are sound and are actively used in practice: "Indeed there have been a large number of money laundering prosecutions in the U.S. over recent years, both in absolute terms and relative to the practice in other countries."
The U.S. was also commended for its international effort to combat money laundering with the evaluation indicating that "cooperation has been strongly promoted at all levels, and the U.S. authorities are to be commended on the leadership role they have provided in the relevant international fora."
The assessment concluded that "overall, the United States anti-money laundering system meets the FATF’s 40 Recommendations in most respects and in a number of areas it takes the lead in developing counter-measures against money laundering. By continuing to respond to the challenges energetically, and by expeditiously continuing the program of change which it has commenced...it will create an even more effective system to combat money laundering."
"The Department of the Treasury, in cooperation with others in our government and around the world, is continuously working to develop new and innovative techniques to close off the channels the criminals use to launder their illegal proceeds and to put launderers themselves behind bars, said Raymond W. Kelly, Under Secretary of the Treasury for Enforcement. "The positive evaluation received by the United States further confirms how effective we can be when all of us work together."
In addition to the United States, mutual evaluations occurred this year in Australia, the United Kingdom, Denmark, Austria and Belgium.
The annual report also includes a summary of significant events accomplished during FATF’s eighth round, which was chaired by Italy under the presidency of Fernando Carpentieri, Director General, Ministry of the Treasury, Italy. Several important tasks were conducted by FATF in the past year, including a broad-ranging review of money laundering trends and techniques which included the specific examination of the threat posed by the development of new technologies in payment methods.
The FATF also pursued its work in a number of areas concerning the implementation and refinement of anti-money laundering measures. In addition, an intensive program of contacts with non-member countries was conducted. Finally, FATF began to consider the review of its future work, which will be taken forward during the ninth round of FATF under the presidency of Belgium.
Copies of FATF’s annual report are available via mail by contacting FinCEN at (703) 905-3770. Additional information can also be obtained by contacting the FATF Secretariat in Paris at (33-1) 45 24 79 45.