second year master students of the specialty "Jurisprudence"
Direction: "The tax and banking lawyer".
Institute of Contemporary Applied Law,
Moscow State Law University named after O.E. Kutafin
The international system of counteraction to money laundering and financing of terrorism
Annotation. Problems of counteraction to legalization (laundering) of proceeds taken from criminal ways is particular importance not only for the states, but also for the entire international community today and the social danger of this phenomenon in the past decade has acquired new dimensions, showing its strong connection with the financing of terrorism.
For any of the States, regardless of the level of development of its socio-economic and legal systems, the entering of criminal proceeds to the national economy leads to the establishment of control by criminal community on individual sectors of the economy, the spread of corruption, means and methods of unfair competition, the reorientation of the economic actors in the interest of criminal groups and as a result – to the significant economic strain of the whole system.
Key words: transnational crime, money laundering, financing of terrorism, counteraction, agreement, organization.
The processes of economic globalization taking place in the 70-80 years of XX century are equally affected criminal structures. The activities of criminal organizations, particularly in the illegal production and trafficking of drugs and psychotropic substances, illegal arms trafficking, terrorism and human trafficking has acquired an international character. Funds received as a result of these criminal activities are invested in the legal economy, which contributes to its criminalization. Due to the enormous scale of these processes and laundering of proceeds taken by criminal means, the fight against organized crime has ceased to be only the task of law enforcement agencies and passed into general policy.
The growth of these processes has stimulated international community to unite in the fight against money laundering and establishment of appropriate legal and organizational institutions.
The international system of combating money laundering and financing of terrorism exists in a series of initiatives of UN, IMF, World Bank, European Union, Council of Europe, the Group of Seven/Eight leading industrialized democracies of the world and other international organizations and institutions, as well as separate states and has a number of specific features that have become a reflection of the complex nature of the challenges that met the international community in the process of creating this system.
The fight against money laundering was not originally considered as an end in itself, but as one of the most effective means of combating serious crimes, including, in particular, illegal drug trafficking and organized crime in general and corruption.
In turn, the freezing of terrorist assets and the overlap of terrorist financing channels are the most important area and tool in combating international and domestic terrorism.
Thus, goal of establishing an international system of combating money laundering and financing of terrorism was not only the suppression of such crimes, it was understood more broadly: to provide undermining of the financial foundations of the whole transnational organized crime, including corruption, and international terrorism. Equally important thing was also to protect from entering of criminal and accordingly, ensure the stability and security of financial institutions and the entire financial and economic system.
It should be noted that before the September 2001 counteraction against money laundering and combating the financing of terrorism were considered and developed as separate areas of international cooperation, and only after the terrorist attacks to the United States was begun the process of forming a single international system for combating these criminal activities.
For effectively counter the entering of criminals in the international financial system the network of safe measures should have a universal character without gaps or weaknesses in the form of separate countries and territories in which such measures are not applied or are applied consistently not enough. In turn, the effectiveness of the national regime against money laundering and financing of terrorism depends on how strictly these standards are followed by financial intermediaries, including financial institutions and other persons, providing access to the financial system[1, p.88-89].
The combination of complex methods in a large extent determined the originality of the development process and the complex structure of the international system of combating money laundering and financing of terrorism, which has combined the traditional organizational and legal mechanisms of the fight against crime with the new institutions and instruments of a preventive financial nature.
The international system of combating money laundering and financing of terrorism consists of the following elements:
- international and regional organizations and other bodies and structures, including specialized;
- international treaties and acts, including the foundation acts of international and regional organizations and other bodies;
- a set of organizational and national legal systems to counter money laundering and financing of terrorism.
The basic characteristics of the international system of combating money laundering and financing of terrorism are subject content of regulated relations and subjective part of this relationship.
The subject of regulation in the framework of the international system is a special set of financial, supervisory and operational-analysis of measures aimed at the prevention, detection and control of financial transactions related to these crimes, as well as law enforcement to investigate and prosecute money laundering and financing of terrorism.
The subjects (participants) of the corresponding relations are the states, competent public authorities, financial institutions and other financial intermediaries, as well as legal entities and individuals engaged in transactions with funds or other assets.
It should be noted that in terms of these characteristics of the international system of combating money laundering and financing of terrorism is a component (or subsystem) of the global international system of combating with criminality.
The most important common characteristics of the international system of combating money laundering and financing of terrorism are also its legal and institutional basics.
Institutional basics of the international system of combating money laundering and financing of terrorism include international bodies and organizations involved in the establishment and implementation of relevant norms and standards and provide direct interaction between the actors of the system, as well as their methods and means of legal and political regulation.
As reaction to growing threat of international security by transnational organized crime and terrorism, the international community will organize a global counteraction of money laundering and financing of terrorism, using in this purpose existing international organizations and creating new specialized bodies and structures. Such organizations and specialized bodies combined with their using methods of regulation of international cooperation in this field constitute the institutional foundations of the international system of combating money laundering and financing of terrorism.
It should be noted that not all actors of the international system of combating money laundering and financing of terrorism have all the formal attributes of an international organization, including such basic ones as the presence of the memorandum of association (or other act), regular (work) agencies and the appropriate budget [1, p.113].
From a legal point of view, international organizations are not the "Group of Seven / Eight", Financial Action Task Force on Money Laundering (FATF) and a significant part of the regional structures by FATF, the Group of Financial Intelligence Units ("Egmont Group"), the Wolfsberg Group, uniting together the 12 largest banks in the world and some other organs, occupying a leading position in the coordination of policies, the development and dissemination of standards in the field of combating money laundering and financing of terrorism [2, p.53].
It appears that the informal nature of these structures and involved mechanisms allowed them in a relatively short period to develop a universal set of countermeasures to money laundering and financing of terrorism and ensure their universally recognition as the relevant international standards.
In terms of values and mutual ratios of the separate components of the institutional foundations of the international system of combating money laundering and financing of terrorism should recognize the leading role of the "Group of Seven / Eight", which initiated the creation of this system and performs functions of political control and coordination of activities of all its participants.
Accordingly, considering the large number and diversity of international organizations and bodies doing with issues of countering money laundering and financing of terrorism currently, the effectiveness of the taken measures is largely dependent on the consistency of their activities and the availability of certain coordination mechanisms. Usually, in practice, the required interaction is provided through the participation of representatives of such organizations and agencies in joint activities, including the development of international standards. In many cases, organizations and bodies receive from each other the status of an observer.
The legal basis of the international system of combating money laundering and financing of terrorism are international legal instruments that contain relevant rules of law, as well as a set of these rules and regulations, which are international standards for combating money laundering and financing of terrorism.
Considering the transnational nature of the offenses related to money laundering and financing of terrorism, effectively countering to them requires the active participation of all countries. For the development of international cooperation in this area an appropriate legal framework is necessary, consisting of the following items (levels):
- the presence of agreements on specific forms of cooperation in the field of combating money laundering and financing of terrorism between relevant agencies of different countries, including the financial intelligence units, law enforcement and supervisory authorities;
- uniformity of legal regulation of combating money laundering and financing of terrorism in national legislation, including the criminalization of relevant acts, creating a system of collecting information on suspicious transactions, etc.
These elements constitute the legal basis of both national and international systems to counter money laundering and financing of terrorism and closely linked. In the context of the free movement of capital and people, no state, even with the most stringent internal control, can not effectively counter money laundering and financing of terrorism in the offline mode. However, the effectiveness of cooperation between competent authorities in different countries is largely dependent on the availability of their respective mandates, as well as informational and other resources.
In the field of combating money laundering and financing of terrorism the displacement trend of the emphasis from regulating the inter-state relations on the harmonization of domestic legal regimes in the international law is clearly pronounced, subjects of which are mainly private individuals. This trend extends to practically all areas of international cooperation, but in the financial sector, it proved to be earlier and more urgently which was marked by domestic scientists [3, p.61; 4, p.115].
Recently, questions of creation of the legal framework for international cooperation in combating money laundering and financing of terrorism and the harmonization of national legislations on the basis of the relevant standards are at the center of international attention.
The existing legal framework of the international system to counter money laundering and the financing of terrorism is characterized by a certain fragmentation and considerable diversity of its constituent legal sources in relation to the formal independence of the organizations and structures dealing with norm-setting in the field of combating money laundering and financing of terrorism.
The analysis of all these sources of international law shows that in the field of combating money laundering and financing of terrorism is important:
- for building the foundations of the international system in this area – legal non-binding acts with recommendatory nature (international standards);
- for securing the effective mechanisms for the implementation of these international standards, including on international cooperation of the competent authorities of foreign states - legally binding instruments of bilateral or multilateral nature.
The specifics of the existing international system of combating money laundering and financing of terrorism consist in that its functions are not limited to the regulation of international cooperation in this field between the authorities of different countries and include primarily maintenance of formation of respective national regimes (systems) in each country. It is understood that as direct participants of the international system of combating money laundering and financing of terrorism are not only states and their competent authorities, as well as a wide range of national and transnational financial institutions and other persons providing services to ensure access to the global financial system.
As a consequence, we can conclude that along with international institutions that perform the role of the regulatory superstructure, the basic components of the international system are considered national regimes (systems) to combat money laundering and terrorist financing.
As a consequence, we can conclude that along with international institutions that perform the role of the regulatory superstructure, the basic components of the considered international system are national regimes (systems) for combating money laundering and financing of terrorism.
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3. Altshuler A.B. International Monetary Law. - M., 1984. - 256 p.
4. Shumilov VM International Financial Law. - M., 2005. - 328 p.
List of references:
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