The Financial Action Task Force (FATF) today published the main findings of its recent Evaluation of Ireland's measures to combat Money Laundering and Financing of Terrorism. The full report is expected to be published shortly.
The FATF is the main international anti-money laundering organisation. Its 40 Recommendations, as revised in 2003 constitute the international standard for action against money laundering. Similarly, its 9 Special Recommendations on Terrorist Financing which were issued in October 2001 set standards for action in that regard. Those recommendations have been embodied in the 3rd EU Money Laundering Directive which has a transposition deadline of December 2007.
The Ministers for Finance and Justice, Equality and Law Reform jointly welcomed the Report and said they were satisfied at Ireland's relatively high compliance rating for what they described as the FATF's tough new standards adopted in June 2003. They undertook to examine the Report's recommendations thoroughly and gave a commitment to further strengthening Ireland's anti-money laundering mechanisms. They pointed to the recent actions of the Garda Siochana in two high profile cases as an indication of the authorities' determination to tackle the laundering of the proceeds of criminal activity.
The Ministers added that the Irish Government endorses the need for an effective international regime to counter Money Laundering and Terrorist Financing.
The FATF Third Round of Mutual Evaluations began in 2004 and has adopted a more detailed approach to the assessment based on the tough new standards that the FATF adopted in June 2003. Since early 2005 Belgium, Switzerland, Australia, Norway, Italy (IMF evaluation), Sweden and Ireland have been evaluated. Ireland's ratings are comparable to those obtained by these countries.
Many of the recommendations on which Ireland is currently assessed as either partially compliant or non compliant will be addressed in the transposition into Irish Law of the 3rd EU Money Laundering Directive. The special recommendation on regulation of wire transfers (to counter terrorist financing) on which Ireland and most EEA Member States are rated non compliant is being addressed by an EU Regulation (which will be directly applicable).
The main findings of the recent Evaluation are that Ireland generally achieves a high standard in relation to legal measures to criminalise money laundering and terrorist financing, in its institutional and other arrangements and in international co-operation. The Evaluation notes in particular that Ireland has a broad money laundering offence, which meets the FATF requirements and the provisions for the confiscation of the proceeds of crime appear effective and comprehensive. The offence of Terrorist Financing is criminalised broadly in accordance with the UN requirements.
The Ministers noted that process of reviewing and updating the Irish legal framework to meet both our domestic needs and international obligations is already under way. Ireland opted to be evaluated early in the 3rd Round of Mutual Evaluations because this would be of considerable assistance in planning the transposition of the EU 3rd Money Laundering Directive into Irish Law.
The main findings of FATF's evaluation of Ireland's measures to combat Money Laundering and Financing of Terrorism are available on their website www.fatf-gafi.org
1 March 2006
Note to Editors
Background Note
The FATF is an inter-governmental body, established in 1989 by the G-7, which sets international standards and develops and promotes policies to combat money laundering and (since 2001) terrorist financing. It currently has 33 members: 31 countries and governments (all pre-1 May 2004 EU states and most other OECD members) and 2 international organisations, with more than 20 observer bodies/international organisations (including IMF/World Bank).
The FATF's recommendations of June 2003 have been incorporated in the third EU Money Laundering Directive which came into force in December 2005 and is to be transposed by December 2007. The transposition into Irish Law of the Directive will address those areas where weaknesses were identified. These include recommendations in relation to increased attention for politically exposed persons, regulation of non-financial entities and aspects of customer due diligence. The transposition process will also address a number of areas where FATF recommendations are reflected fully in guidance notes, but the guidance notes do not currently impose mandatory requirements with sanctions for non-compliance.
The Evaluation Team consisted of members of the FATF Secretariat and experts in criminal law, law enforcement and regulatory issues from a number of FATF member countries. The team reviewed the institutional framework, the relevant laws, regulations, guidelines and other requirements, and the regulatory and other systems in place to deter money laundering and the financing of terrorism through financial institutions and certain other businesses and professions. During an on-site visit from 27 June to 8 July 2005, the Evaluation Team met with officials and representatives of all relevant Irish government agencies and the private sector.
The Department of Finance chairs the Money Laundering Steering Committee which was set up to oversee the issue of detailed guidance to the various sectors of the Financial Services industry so as to ensure consistent implementation of the anti money laundering provisions of the Criminal Justice Act, 1994. It includes representatives of the Department of Justice, the Garda Siochana, the Revenue Commissioners, the Financial Regulator together with representatives of the Financial Services industry and other designated bodies affected by the anti-money laundering legislation.