Published: Mar 29, 2011 01:00 Updated: Mar 29, 2011 01:00

http://arabnews.com/saudiarabia/article333603.ece

JEDDAH: Saudi attorney Khalid Alnowaiser recently pointed out that money laundering by organized crime syndicates has become an international dilemma and a real challenge for global financial institutions.

In the United States, international experts believe that money laundering has cost $3.61 trillion due to more transparent international financial markets and the spread of technology. These activities are illegal and cause severe economic, social, and political problems. Studies have shown that money laundering supports drug trafficking, terrorism, and arms smuggling.

The growing problem of money laundering gained interest after the 9/11 terrorist attacks in 2001. It has been the subject of many conventions and international conferences including the United Nations Convention Against Illicit Traffic of Narcotic Drugs and Psychotropic Substances in 1988 which is known as the Vienna Convention, the 1994 Amman Conference which involved Saudi Arabia and many other participants from all over the world, and the UN Security Council Resolution 1373 that called on United Nations members to work together to combat the financing of terrorism.

Saudi Arabia and many other Arab countries have issued special laws seeking to combat money laundering.

In 2003, Royal Decree No. M/39 was issued followed by a Saudi law to combat money laundering.

In 1999, Council of Ministers Decision No. 15 ratified the implementation of 40 recommendations to combat money laundering issued by the Financial Action Task Force (FATAF). All decrees conform to the opinions of many Islamic scholars prohibiting money laundering.

However, many obstacles still exist in fighting money laundering, including bank secrecy rules preventing the disclosure of bank accounts and deposits, a general lack of consistent modern information regulations, different regulations in each country, and computer hacking activities.

Alnowaiser suggested the following recommendations be immediately implemented to fight money laundering:

l Revoking the charters of bank and financial institutions involved in money laundering.

l Criminally prosecuting those persons involved in money laundering activities.

l Better training of bank employees so they can become better acquainted with modern technological innovations to uncover money laundering activities.

l Most importantly, establishing a powerful central agency to monitor international financial transactions, identify financial transactions linked to illegal or suspicious activities, disclose the activities of those persons engaging in money laundering, and publicize these preventative steps to citizens through the media.