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“… we know that because of the terrorist attacks, growth in developing countries will falter, pushing millions more into poverty and causing tens of thousands of children to die from malnutrition, disease and deprivation…”
Our goal must be to eradicate poverty, while fighting terrorism
James D. Wolfensohn
President, the World Bank Group
From the Op-ed in the International Herald Tribune, Le Monde,
and El Pais as well as in the “Development Outreach”
Overview
Strategy
AML/CFT in the World Bank
Overview
In recent years, and especially since the tragic events of September 11, 2001, worldwide efforts to combat money laundering and the financing of terrorism have assumed heightened importance. Money laundering and the financing of terrorism are global problems that not only threaten security, but also compromise the stability, transparency, and efficiency of financial systems, thus undermining economic prosperity.
James D. Wolfensohn, president of the World Bank Group, has declared that the global community should act “where it really matters”—and, economically, money laundering and financing of terrorism really matter. At least US$1 trillion is laundered annually using increasingly sophisticated methods of moving funds across borders. Financing of terrorism is a significant global threat that has a detrimental impact on economic and social development.
Strategy
The global agenda to curb money laundering and the financing of terrorism calls for a cooperative approach among many different international bodies. Efforts to establish an international standard response against against money laundering and the financing of terrorism have been led by the Financial Action Task Force on Money Laundering (FATF) and through with the development of the FATF 40 Recommendations which serve as the international framework for AML efforts. In October, 2001, FATF expanded its mission to include combating the financing of terrorism, and adopted Eight Special Recommendations on Terrorist Financing. The Boards of the World Bank and the International Monetary Fund (IMF) have recognized these recommendations as the appropriate international standard for combating money laundering and the financing of terrorism and, to join in the fighting consequence, have intensified their work in this area.
The World Bank and the International Monetary Fund have also established a collaborative framework with the FATF for conducting comprehensive AML/CFT assessments of countries’ compliance with the FATF 40+8 Recommendations, using a single global methodology. This global methodology was endorsed by the World Bank and IMF Boards in September, 2001 and adopted by the FATF Plenary on October 11, 2002. A 12- month pilot program is currently underway using the new global methodology to assess the AML/CFT infrastructures in 16 – 20 developing countries. These assessments will lead to a Report on Observance of Standard and Codes (ROSCs).
AML/CFT Efforts Throughout the World Bank
Various departments in the World Bank Group are currently tackling with money laundering and the financing of terrorism. Here are the list of departments to which links are available.
East Asia and Pacific Region
Europe and Central Asia Region
World Bank Institute
Department of Institutional Integrity
Legal Department
Poverty Reduction and Economic Management (PREM)
International Finance Corporation (IFC) |
