Artificial harmony

Clifford Williams

Journal of Money Laundering Control, 2014, vol. 17, issue 4, 428-439

Abstract: Purpose - – The purpose of this paper is to explain that the commonly used method allowing for inter-agency cooperation between national financial intelligence units, the memorandum of understanding, is inadequate and ineffective in creating a cooperative global financial intelligence unit capable of combating money laundering typologies on an international scale. Design/methodology/approach - – Methods of international financial intelligence unit (FIU) cooperation have chiefly occurred in two ways: first, through the efforts of the Egmont Group; and second, through the inclusion of provisions concerning FIUs contained in international legal documents. The first is an impossibility. Findings - – This paper proposes that the result of implementation of the 2012 Financial Action Task Force Recommendations will be an informal network of FIUs where the Egmont group acts as a centralized operator for information exchange, effectively creating an informal global FIU (“GFIU”), but that this system, or a cooperative global financial intelligence unit system based on FIU-to-FIU exchanges will not allow for effective multilateral, international cooperation. Research limitations/implications - – This is because national interests and unfamiliarity with capabilities provided in the Egmont Group’s cooperative platform have and will continue to result in under-utilization of cooperative efforts, and because the traditional mechanism employed for FIU-to-FIU exchanges, the memorandum of understanding (“MOU”), makes uniform or standardized information request and transfer procedures that are required for multilateral or multi-agency efforts to combat money laundering across international boundaries an impossibility. Practical implications - – The Egmont Group’s cooperational structure should be the primary means by which to achieve a GFIU. Social implications - – The global combat on money laundering will be more effective, thereby more fully protecting the global economy. Originality/value - – A comparison between the Egmont Group’s network building mechanism and the existing use of MoU to create global cooperation against money laundering has not been analyzed.

Keywords: Cooperation; Memorandum of understanding; Financial intelligence unit; FIU; Global (search for similar items in EconPapers)
Date: 2014
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Persistent link: https://EconPapers.repec.org/RePEc:eme:jmlcpp:jmlc-08-2013-0030

DOI: 10.1108/JMLC-08-2013-0030

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