This week the Fairmont Hotel in Monaco is playing host to finance professionals from around the world who are trying to fight money laundering. The Joint Experts Meeting on Typologies is hosting a series of workshops to discuss current money laundering and terrorist financing trends and techniques, and to exchange experience and best practices. It's being organised by Moneyval and the Financial Action Task Force on Money Laundering (FATF).
So it was understandable that Monegasques were upset at the weekend, when French newspaper Le Monde published a story suggesting Monaco was being investigated and that the Principality was allowing money laundering to take place. HSH Prince Albert II strongly denies these accusations and rightly insists that Monaco is not a refuge for criminals. As a member of Moneyval, the Principality upholds the importance of international cooperation and exchange of information, and is putting in place procedures for fighting money laundering and for allowing more transparency.
FATF (or GAFI in French), was set up in 1989 to investigate money laundering and to develop measures that could be taken against it. They published a plan of action with 40 recommendations, which was later extended to include 8 special recommendations that deal with terrorist financing, followed by a 9th recommendation in 2004. As an associate of FATF, Moneyval helps its own members to comply with international standards and recommendations such as the 40+9 developed by FATF. Member states use self evaluation and peer pressure mechanisms, and since Moneyval is a committee of the Council of Europe, Monaco is a member of Moneyval.
Such international organisations and their members have a difficult task ahead, since when criminals launder dirty money, they may often use legitimate establishments and businesses. In March this year, the English Football Association was obliged to publish a guide for unsuspecting football clubs explaining what money laundering is and how they can avoid being party to it. Tackling money laundering isn't straightforward and kicking mud at Monaco's reputation doesn't help. Everyone needs to keep their eyes on the ball.