It remains a global concern ... a conference in Doha examines compliance challenges and combating financial crime

Mohammed Al-Shayazami-Doha

Despite all the efforts of the regulatory authorities in various countries of the world in efforts to combat money laundering and terrorist financing, the seriousness of these global and cross-border crimes continues to grow and defy legislation, but rather invests innovation in the banking sector in their favor.

In the conference on "Challenges of Compliance and Combating Financial Crime" - which started today Wednesday in Doha and ends tomorrow with cooperation between the Qatar Central Bank, the Federation of Arab Banks and the International Federation of Arab Bankers - most of the opening words agreed that the phenomenon of money laundering and terrorist financing is still a global concern despite laws and international agreements And regional and national levels that coordinate the efforts of states and organizations to confront the development of these financial crimes and methods of committing them.

The first sessions of the conference in which a group of senior specialists in the field of financial crimes, combating money laundering and terrorist financing from various countries of the world discussed a number of key axes, including the extent of adherence to the new international standards, and the promotion of effective implementation of legal, organizational and operational measures to combat money laundering and terrorist financing , And threats to the integrity of the international financial system, especially those related to electronic security, suspicious transaction monitoring, technology security and data analysis.

The organization of this conference comes in the context of official and unofficial international reports around the world that have agreed to multiply money laundering operations during the past two decades, where HSBC estimated the losses of the global economy due to financial crimes at about $ 2.1 trillion in 2018, while it was estimated The World Economic Forum total losses of about $ 2.4 trillion for the same year.

Heavy regulatory burdens
Sheikh Mohammed bin Hamad Al Thani, Deputy Governor of the Central Bank of Qatar and Chairman of the National Committee for Combating Money Laundering and Terrorist Financing, addressed in his speech the impact of financial crimes of various kinds on the global economy and financial stability directly, in addition to the challenges and the level of risks posed by the technology sector, which imposes Supervisory and supervisory bodies have heavy burdens to confront them, reduce their impact and reduce financial and electronic crimes.

He talked about the legislation that Qatar enacted in the field of combating money laundering in 2019, its compatibility with international standards issued by the Financial Action Group, and also the issuance of the anti-terrorism law in the same year, and the introduction of the necessary amendments to a number of laws that enabled the consolidation of best legislative practices within an integrated system , In addition to her commitment to the recommendations of the fortieth financial work group and the 11 direct results, as a member of the financial working group "FITF" and the financial action group for the Middle East and North Africa, and her membership in the Gulf Cooperation Council.

These reforms have been a reinforcement of the efforts made by Qatar over the past years, which made it ranked first in the Gulf and second in the Middle East and North Africa region in the Basel Index for Combating Money Laundering and the Terrorist Financing Risks of 2017.

This year is also important for Qatar, as its efforts will be evaluated by the Financial Action Group "FITF", an intergovernmental body tasked with preparing and developing policies related to combating money laundering and terrorist financing worldwide.

Many challenges
On an ongoing basis, the competent international institutions are working to update the standards and legislations necessary to keep pace with the new challenges, as they seek to strengthen the internal control procedures associated with combating money laundering and terrorist financing, and to avoid exposure to sanctions, banks in turn comply with these legislation and standards.

Antoine Hobeish, strategic advisor to the Anti-Financial Crime Compliance Group in the Middle East and North Africa, believes that the financial and banking sector faces challenges from the Arab world, among them the presence of small capital banks that are unable to invest in advanced protection systems, and keep pace with global mobility in this field.

Hobeish said in a statement to Al-Jazeera Net that about 80 thousand international standards of protection and anti-money laundering crimes are issued annually, and they need huge work teams and modern systems in order to implement them, for this it is necessary to strengthen banking cooperation in the Arab region and to create initiatives capable of raising the quality of their performance , And secure its transactions and keep it away from danger areas

The banking sector has not escaped from being involved in suspicious money laundering operations, as it is the most important episode in which illicit money revolves, due to the complexity, speed and overlapping of these banking operations.

The Chairman of the Board of Directors of the Union of Arab Banks, Muhammad Al-Jarrah Al-Sabah, stated that international reports indicate that since 2009 until the current year, the penalties for a number of these institutions due to their involvement in money laundering and terrorist financing crimes amounted to about $ 17 billion.

Al-Jarrah called for the necessity of the function of managing the risks of money laundering and financing of terrorism to be compatible with the overall framework for risk management in banks, and to consider striking a balance between preserving the integrity and durability of legal systems, developing innovation in the financial and banking sector, and enhancing compliance with applicable laws and legislation.

Major losses
Money laundering and financial crimes have dire economic, social and political effects on various countries, as they work to weaken financial systems as a result of smuggling funds outside the country, and thus weakening savings rates and declining real investment in the national economy and high unemployment rates, which endangers the social and economic development of these countries. .

In addition to the direct losses of the global economy from money laundering operations, the countries of the world spend annually to combat these operations approximately eight billion dollars, according to the International Federation of Arab Bankers, and money laundering operations according to the estimates of the International Monetary Fund occupy the third place between business globally after currency exchange and trade The oil.

The questionnaire of Reventiv Foundation - an inter-governmental body established in 1989 - also showed that companies in the Arab region spend about 3.8% of their total revenues to combat financial crime, which is the highest percentage compared to all regions of the world.

On the second day, before the drafting of its final recommendations, the conference will discuss other prominent axes in which international banking officials and legal experts speak, including updating the forms of combating money laundering and financial crimes according to the economic right holder, protecting compliance data through communication between the required channels, and combating global financial crimes in 2020, challenges and opportunities to strengthen interbank relations.