Analysis Materials 22 November 2006 12:04 (UTC +04:00)

A new service involved in fighting with the laundry of criminal incomes and financing of terrorism financial intelligence may appear in Azerbaijan next year. Starting the struggle with the laundry of funds gained through criminal ways the government commences struggle with economic crimes, corruption, drug trafficking and other types of dangerous crimes, not excluding terrorism. The government's efforts directed at the establishment of a financial intelligence body in the country is supported by the Unite States, the country that leads the economically developed countries, and set up fighting with the laundry of dirty money and financial terrorism 10 years ago.

What is the financial intelligence?

It is an authorized body that receives data on suspicious operations, perhaps those linked with laundry of money and financing of terror, analyze the data and pass to law-enforcement bodies if any criminal motive is found. Respectively, the financial intelligence is not a lawenforcement body, or cartel, but automated database prated by specialists. It functions in the following way. The government sets a ceiling sum, for example $20,000 (in many countries it is only $10,000). Information on movement of money over this sum should be passed by all participants of the financial markets (banks, insurance companies, realiter agencies, state registration, and entertaining centers) to the financial intelligence service in the obligatory order. Later specialists will study the source of finances, check up the owners participation in the laundry of criminal incomes. "Dirty" money are the incomes obtained as a result of drug trafficking, arms and human trafficking, Р"СЋРґСЊРјРё, оружием, robbery, racketing earnings as a result criminal acts.

No attention will be paid to once-only operations. But if a person spends $20,000 in a month for many times, the computer will fix the facts and the specialists will have to analyze the source of incomes.

The criminals frequently use ordinary people in their own purposes. If there is suspicious information the law-enforcement bodies will get involved in it. Annually $100 mln comes to the bank system from such kinds of crimes.

In accordance with the world experience, there a special divisions at the Financial Intelligence Service which carries out check-ups. The Service works in close cooperation with the National Bank of Azerbaijan, which is also in charge of controlling. Those unwilling to fulfill the requirements of the Financial Intelligence are threatened to pay fines or cancellation of licenses.

What to do?

Azerbaijan is an active participant of these measures. The international organizations called on to establish a national strategy and for many years Azerbaijan has been taking measures on the base of the President's instructions on intensification of the activities of the law enforcement bodies directed fighting with the laundry of dirty money, corruption, and human trafficking. Moreover, there were held institutional reforms in line with the norms specialized in the UN Conventions and FATF.

On 30 October Baku hosted a conference on Legal framework to combat the financing of terrorism and financial crimes organized by the U.S. Embassy in Azerbaijan, Council of Europe and Azerbaijani Government. The meeting was a policy of relevant organizations to establish a co-operation framework in this sphere. Azerbaijan intends to adopt an appropriate legislation to combat money laundering, terrorist financing and other financial crimes. It demonstrates the desire of Azerbaijan to co-operate in fight with terrorism,

Azerbaijan has received a positive reply on the bill on Fighting with the Dirty Money Laundry and Financing of Terrorism from the World Bank, the international Monetary Fund, the U.S. Justice Department, and the UN Drug Enforcement Department. The draft law took into consideration the relevant experience of many countries and international principles. It defines the requirements laid on bodies involved in control and obligations on the establishment of the financial intelligence, collection of data on financing of terrorism and assistance in fighting with such crimes.

What are the proposals?

There are four models of establishment of financial intelligence police, prosecutor's, administrative and hybrid. The first of the models envisages the creation of such body at the police bodies, the second at court bodies and Prosecutor's offices, the third administrative model envisaging the establishment of such divisions at the Central Bank or the Ministry of Finances, and the fourth model combined, named hybrid' model with the participation of representatives of different administrations. The selection of more optimal variant among them is an important task of Azerbaijan.

A financial investigation bureau should be established in the Country within the Public Prosecutor's Office, Rustam Ussubov, First Deputy Public Prosecutor of the Country stated.

He pointed out that the Department for the Struggle against Corruption has already existed within the Azerbaijan Public Prosecutor's Office, and the new establishment may be created within the Public Prosecutor's Office. However, this organization will not hold the same duties. The new Bureau will hold more authority, said the Deputy Public Prosecutor of the Country, and added that work on the corresponding legislation is presently underway.

The financial intelligence in Kyrgyzstan is established at the President's administration. It is an international practice and is more optimal resolution.

For effectiveness, such organizations should be independent and accountable. And of course, those organizations should establish co-operation with the same organizations of other countries. Otherwise, the revenues from the criminal activities and terrorism within the country may spread outside the country, the U.S. Ambassador to Azerbaijan says.

Thus, the establishment of financial intelligence is the demand of the international community and Azerbaijan should fulfill it so that not to turn out of the frames of general integration in fighting with the laundry of money.

Finally, it is necessary to be beware of dishonest people to turn out in this Service to change their position as an income source. The legislation must be toughened. For example, Russian laws penalizes the publication of service information or use it for own purpose by 10 years.