Keeping the banking system safe from dirty money
Despite the recommendations issued by the Bank for International Settlement (BIS) and its keenness advise central banks on stronger regulation of global banking transactions, notably in the context of combating money laundering, recent revelations that some international banks have indulged in money laundering have shocked governments and central banks around the world.
It is estimated that as much as $2 trillion was laundered over the past two decades.
A key question being asked in this regard is what have the control, supervision, and auditing bodies in the central and commercial banks, as well as the financial intelligence and security agencies around the world, doing all these years? And why is it that this huge scam being leaked only today?
The news report by ICIJ confirms that the laundered funds are profits from wars waged over the past two decades, including in the Arab region, the proceeds of gangland drug sales, human trafficking, and the illegal trade in arms and wealth looted from some developing countries, in addition to funds stashed away by smugglers.
Most of the gangs operating in this regard have succeeded in laundering these dirty funds using several major international banks, some of which operate in this region.
The report dealt with thousands of documents leaked about suspicious activities that were submitted to the Financial Crimes Enforcement Network (FINCEN) of the US Treasury Department, which works to monitor the funds transferred, whether inside or outside the US.
Someof these documentsbearthe names of Arab companies working in the field of oil and gas production, and others for institutions operating in countries in Latin America, and in many countries of the world, which confirms that criminals were able to exploit loopholes in thebanking system to launder dirty money.
The coming days will reveal more secrets about these dirty transactions.
Many of the banks named in the scam have been involved in evaluating the creditworthiness of countries, as well as managing assets and loans for banking and financial institutions, and in financing international activities.
Can the Bank for International Settlements, through its advisory to central banks around the world, avert another global financial crisis in the coming years amid a proliferation of thousands of shell companies uncovered by the latest scandal? What matters to us here is to keep our Gulf banks untainted by this scam and prevent our banking system from being exploited by corrupt elements.