Collaboration between public sector agencies and reporting entities such as banks can significantly enhance the effectiveness of measures to counter financing of terrorism according to the International Monetary Fund’s (IMF’s) recently published book on counter terrorism financing frameworks (Trade-based Financial Crime, 15 May 2023).

Countering the Financing of Terrorism: Good Practices to Enhance Effectiveness describes how, in a small but increasing number of countries, collaboration through public-private partnership platforms has led to better risk-focused tailoring of preventive measures.

This includes work on developing enhanced risk indicators, risk profiling, and jointly developed algorithms that help direct data analysis, including technology-driven analysis.

Joint task forces

The creation of joint task forces has enabled ongoing sharing of operational information behind closed doors. The UK has adopted legislation that enables experimentation with practices to grant formal security clearance to a vetted group of compliance officers from reporting entities and to set up an innovative information-sharing system.

The UK’s joint money laundering intelligence taskforce (JMLIT) is a partnership involving over 40 forty financial institutions and several law enforcement organisations. Hong Kong and Australia have set up similar public–private information-sharing partnerships.

Facilitating information exchanges

Ireland established a public–private partnership in 2017 known as the joint intelligence group. Members include the main retail banks, the largest money remittance firm operating in the jurisdiction and the financial intelligence unit (FIU).

In Germany, the anti-financial crime alliance brings together the FIU, police and 14 banks. As a public–private partnership, these authorities and banks are seeking to strengthen and coordinate the fight against money laundering and terrorist financing under the FIU’s leadership

All of these platforms essentially convene law enforcement and financial institutions to discuss money laundering and terrorist financing risks. The national authority oversees and facilitates information exchange between government authorities and financial institutions based on law enforcement priorities.

Countering the Financing of Terrorism: Good Practices to Enhance Effectiveness can be downloaded from here.

Categories: Trade Based Financial crimes News