Expert warns of money laundering peril

Dedicated event ‘Money Laundering – Managing the Menace’ aims to help executives in financial institutions and government officials guard against money laundering.

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By  David Ingham Published  September 24, 2001

Lessons Learned Ltd, a financial services training consultancy, warns that the Middle East could be an increasing target for money laundering. The company was speaking ahead of ‘Money Laundering – Managing the Menace’ an event to be held by Lessons Learned and Afridi & Angell at the end of October.

Money laundering is the process by which large amounts of illegally obtained money (drugs being one of the main methods) are given the appearance of having originated from a legitimate source. According to a November 1999 US Senate report, the size of ‘the money laundering problem’ is more than US $1 trillion annually.

“The problem is serious, and becoming more so,” said Tim Parkman, owner and managing director of Lessons Learned Ltd. “This is a staggering amount and detrimental by any calculation to the economies financial systems involved. This level of criminal usage threatens the reputation of national financial systems, invites censure from international bodies such as the OECD, IMF and WTO, and generally hinders a country’s acceptance into the global economy, if it is not seen to be taking genuine steps to combat the problem.”

Banks targeted by the money launderers can suffer greatly. There’s not only the loss of reputation. Take Bank of New York (BONY), which faces a multi-million dollar lawsuit by shareholders alleging that negligence allowed Russian mafia to pump money through the bank.

“It doesn’t matter if it’s nuclear weapons, gun-running, narcotics dealing or plain old fashioned fraud and corruption,” says Parkman. “The overwhelming general rule is that for banks, the only thing worse than getting involved, is being found not to have taken any preventive measures.”

'Money Kaundering – Managing the Menace' takes place October 30 and 31 in Dubai. The program is designed for executives in financial institutions and government officials responsible for ensuring that organisations in their jurisdiction take effective precautions against money laundering.

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