Following the money

By now the hawks must be getting impatient. There’s little action going on, save for the storming of the long-deserted US embassy in Kabul by Afghans. Fighter jets and aircraft carriers have been deployed, but US officials have dropped broad hints that there’s no imminent military retaliation for the terrorist attacks in New York and Washington.

Even US officials are aware that they could just end up wasting missiles if they hit Afghanistan, and risking the ire of many Muslims if they try to take out the Taliban. The ones who’ll do the fighting on the ground here will be Afghanistan’s opposition Northern Alliance, with fresh support from the US-led coalition against terrorism.

What the Americans are doing is rushing to beef up their intelligence-gathering capability, greatly emasculated since the end of the cold war. These days some degree of paranoia is again considered healthy. The spooks have been sent back to their battle stations. The war they will wage, which is bound to turn dirty, we won’t see on the news channels. 

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The US and its allies are also rushing to trace the money, trace the terror, as one newscaster described it. Crimebusters have often been advised to follow the money. Al Capone was finally put away for tax evasion, not murder or racketeering.

Osama bin Laden has learned to use the global capitalist system to finance his extensive operations and achieve his twisted objectives. His financial savvy, surely passed on to some of his lieutenants, makes it all the more urgent for the international community to fight money laundering.

The attacks in the US must have prompted our legislators to finally move their butts and pass a law against money laundering. Or maybe they were just worried about a backlash from the relatives of millions of overseas Filipino workers who may not get remittances on time.

Yesterday the two chambers of Congress passed their versions of a law to fight money laundering. Today the two versions will be reconciled, and the final product will be sent to Malacañang for President Arroyo’s signature before the Sept. 30 deadline set by the Paris-based Financial Action Task Force.

Congressmen have already pointed out loopholes in their bill that money launderers can exploit. And like any law in this country, we’ll have to see how the final product will be enforced.

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The FATF, convened for the first time in 1989 by the Group of 7 industrialized nations, has had some success in fighting money laundering. The task force came up in 1990 with 40 recommendations, which were amended in 1996. These are general proposals covering not only financial regulation but also law enforcement and the criminal justice system.

I don’t know if the bills passed by the Senate and the House of Representatives follow most of the 40 recommendations. But if it’s any consolation to those warning that we should not rush the passage of the anti-money laundering law, the same concerns now being raised here were also raised when the Americans started crafting their own laws to fight money laundering.

In the US State Department’s 2001 report on money laundering and financial crimes, over 175 countries and jurisdictions were classified into three groups: those "of primary concern" for money laundering activities, those "of concern" and those "monitored."

Those in the third category, under monitoring, are not necessarily the toughest on money laundering, but simply those with underdeveloped financial systems such as Afghanistan, Laos and Nepal.

Among the 52 in the first category, of primary concern, are not only those on the FATF’s original blacklist such as the Cayman Islands, Liechtenstein and the Philippines, but also squeaky-clean Singapore, Switzerland and the Group of 8 including the United States.

All financial systems are vulnerable. But with a law, at least we might be able to stay one step ahead of the money launderers.

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Only in RP: One of our editors arrived last week from South Korea. As she was leaving the Customs area at the NAIA, a man in a black uniform looked at a bag of chocolates she had bought in Seoul. His comment: "Okay ’tong chocolate na ’to, wala nito dito ah. Magugustuhan ’to ng mga anak ko." Rough translation: "We don’t have these chocolates here. My children will like them." Our editor ignored him. Do all returning Filipinos get the same greeting? Business must be bad at the Customs area.