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Purpose The purpose of this paper is to illustrate that it remains feasible for terrorists to use the banking system to transfer funds to finance their activities. Design/methodology/approach Based upon a qualitative content analysis of 15 informal interviews with financiers of terrorism and 15 formal interviews with compliance experts and law enforcement officers, concrete methods of financing terrorism through the banking system can be described. Findings Even though banks have implemented strict control mechanisms, they often do not give the same attention to terrorism financing as they do to money laundering. Recently, refugees and “tourists” may have been involved in terrorism financing. When it comes to transferring larger amounts of money, terrorists do not necessarily act in their own name, but rather hire “straw men”. Some terrorists have proceeded to set up real companies in Turkey. Terrorists can explain why funds need to be transferred from Europe to Turkey through “charitable contributions”. Transfers of large amounts of money can also be facilitated by lawsuits. Research limitations/implications The findings are based on semi-standardized interviews limited to the perspectives of the 30 interviewees. Practical implications The identification of gaps in current terrorism-financing prevention mechanisms provides both compliance officers and legislators with valuable insights. Originality/value Whilst the existing literature focuses on understanding the channels terrorists can use to finance their activities and on developing prevention mechanisms, this paper emphasizes that terrorists can still use the banking system to accomplish their goals. This paper illustrates ways terrorists can transfer funds through banks.

Türkiye adopted a new regime on bearer share certificates to comply with the Recommendations of the Financial Action Task Force on money laundering by promulgating the Law on Preventing Financing of Proliferation of Mass Destruction Weapons on 31 December 2020. This new law does not prohibit the issuance of bearer share certificates but ends the anonymity of the holders. According to the new law, the holders of bearer share certificates shall be registered in a centralized registry. In case of transfer of the certificates, the new holder must also be registered in the registry. In this paper, I will first give brief information on shares in Turkish law. Subsequently, I will explain the new system prescribed by the Law on Preventing Financing of Proliferation of Mass Destruction Weapons.

PurposeThirty years after its creation, the Financial Action Task Force (FATF) has become a prime example of a norm-building process that transcends the traditional avenues of public international law, while compelling a high level of compliance and assuring quick adaptation to norms and practices that better address money laundering and the financing of terrorism in their evolving form. On the occasion of FATF’s 30th anniversary, this paper aims to revisit the unique characteristics of FATF and the factors behind FATF’s success as standard-setter and as implementation-reviewer in the anti-money laundering (AML)/CFT context.Design/methodology/approachThis paper draws on primary sources of law, legal scholarship, reports and other open source data to analyse the FATF norm-building process and the factors behind its success.FindingsThirty years after its creation, the FATF has established itself as the key standard-setter, implementation-reviewer and force for reform in the AML/CFT context. Though the FATF norm-building process has been very successful, owing to its flexibility, adaptability and expansiveness, significant challenges lay ahead due to the evolving nature of money laundering and financing of terrorism.Originality/valueThis is a comprehensive study examining the achievements, impact, strengths and weaknesses of the FATF norm-building process on the occasion of the organisation’s 30th anniversary.

PurposeThis paper aims to study the three levels of anti-money laundering (AML) and combating of terrorist financing (CTF) regulations that apply to banks and financial institutions listed within the country. The paper aims to determine risks arising from globalised financial centres within the United Arab Emirates (UAE) and potential improvements deficiencies that may otherwise serve as conduits for criminal and terrorist organisations. There is a significant body of literature that covers the advance of AML/CTF legislation in the Dubai-based free trade zone, the Dubai International Financial Centre (DIFC). Though free trade zones are scattered across the UAE, the DIFC has the highest foreign investment in the country with an expanded international network.Design/methodology/approachThe UAE has made progress as part of its fight against money laundering (ML) and terrorist financing (TF). This paper studies the legislative stance by analysing the country’s AML/CTF laws. Also, the advances of global financial centres in the UAE have created layers of regulation, each regulator with their own set of rules. This paper attempts to study the regulations and the level of their enforcement to combat ML and TF.FindingsThis paper finds significant regulatory oversight in certain frameworks set within the UAE’s financial system. However, the paper finds secondary literature and evaluations conducted by international bodies that suggest some deficiencies within the mechanisms, that are being resolved by the country’s regulatory agencies. The UAE’s advancing network of financial institutions has created a global chain of monetary transfers, which offers some possibility of ML also extending to TF. Though the country has made progress, there remain a few flaws that can be exploited by criminal and terrorist organisations.Practical implicationsML has the possibility to damage markets if allowed in excess. This is not the case with the UAE, and large unverified transactions are investigated by the regular authorities. ML is now a matter of concern when funds acquired through illegal means may be used to directly finance terrorism.Originality/valueThis paper tests the UAE’s mechanisms to combat ML and TF in the context of the country’s advancing of a global central financial market. There is a need to understand these regulations as investors within the UAE and abroad may sometimes face risk if ML/TF deficiencies are exploited by criminal and terrorist organisations. This paper provides an insight into the country’s infrastructure to combat ML and TF and also weighs its performance as per international standards and guidelines.

Purpose This study aims to examine how important the countering terrorism financing is in the fight against terrorism and to what extent does financial intelligence contribute into this field. Design/methodology/approach To this end, to collect data, semi-structured interview method was conducted for 15 experts, including academicians, judges, security and intelligence officers who have specialised and been practising in the field of terrorism. Then, the data were analysed with the descriptive and systematic method. Findings The findings highlight that countering terrorism financing is indispensable in the scope of the combating terrorism; however, there are still much to be done in practice to achieve more success in this field. The results also suggest that the process requires more flexible and proactive approach with the help of an autonomous financial intelligence unit to be more efficient. Moreover, there must be better cooperation and coordination at both national and international levels. Furthermore, training more professionals from multidisciplinary backgrounds and raising awareness among the public and private sectors are found to be other key factors for effective combating of the system. Originality/value The research has been conducted on participants who mostly have been in fight against terrorism over 20 years who are aware of the early methods, as well as the recent ones both in theory and in practice. Their view is significant to understand the situation in combating financing of terrorism.

Purpose Designated non-financial businesses and professions (DNFBPs) are important actors both in the formal and informal sectors owing to the nature of services they offer. The DNFBPs are key players in financial and economic development and thus are highly vulnerable to money laundering (ML) and terrorist financing (TF) risks. Globally, and indeed, within the West African region, typologies studies have indicated several instances of misuse of DNFBPs for the laundering of proceeds of crime and to a lesser extent, TF. Factors that make DNFBPs vulnerable to ML and TF in the region, include limited understanding of ML/TF risk and anti-money laundering and combating the financing of terrorism (AML/CFT) obligations, and poor implementation of AML/CFT measures by the sector. As reporting institutions, DNFBPs are required to implement appropriate measures to mitigate the ML/TF risk facing them. Mutual evaluation reports (MERs) of countries in the region noted weak implementation of AML/CFT measures by DNFBPs compares to financial institutions. These coupled with the general poor monitoring and supervision of DNFBPs for compliance, make them a weak link in member states’ AML/CFT regime. This study examined how Economic Community of West African States member states can plug the loopholes in the DNFBPs to strengthen their AML/CFT regime and thus improve their performance during mutual evaluation. This study reviewed data from the publications of Inter-Governmental Action Group against Money Laundering in West Africa (GIABA), Financial Action Task Force (FATF) and other credible sources. Design/methodology/approach This study is more of desk-review based on secondary data, including information obtained from GIABA, and FATF publications, and websites as well as information obtained from reliable sources on the internet. The authors reviewed the MERs of GIABA member states that have been assessed under the second round, especially that of Ghana, Senegal, Cape Verde, Mali and Burkina Faso, with particular focus on sections of the reports relating to preventive measures and supervision. In general, this paper adopts a policy approach with a view to explaining the importance and benefits of implementing AML/CFT preventive measures by reporting entities, especially the DNFBPs. Findings This study found that there is a general lack of information on the exact size of DNFBPs across member states, the risk of ML/TF associated with DNFBPs is generally identified as high across member states (albeit at different levels), the extent and level of monitoring/supervision of DNFBPs for AML/CFT compliance trails what is obtainable in financial institutions; the institutional and operational frameworks for regulating, supervising and monitoring DNFBPs are either weak or poorly defined in many member states; and the focus of AML/CFT technical assistance has been more on financial institutions than DNFBPs. Although the number of MERs reviewed for this work may be few, the findings and conclusions in the concluded MERs reflect regional peculiarities, including high informality of the economies, preponderance use of cash in transactions, diversity of DNFBPs and the general weak application of AML/CFT preventive measures by these entities, and the weak AML/CFT supervision or monitoring of DNFBPs which cut across all GIABA member states. Although efforts to address the weaknesses in the DNFBPs, including training and supervision, have commenced, in most member states, these are still at rudimentary levels. Research limitations/implications However, this study is limited by the fact that it was desk-based review without direct inputs of industry players (DNFBPs and their supervisors). Practical implications In general, this paper adopts a policy approach with a view to explaining the importance and benefits of implementing AML/CFT preventive measures by reporting entities, especially the DNFBPs. It aims to bring to the fore the weaknesses of the DNFBPs in the implementation of AML/CFT preventive measures and therefore will be useful to national authorities who are striving toward strengthening their national AML/CT regimes and to DNFBPs who wish to protect the integrity and stability of their system. Originality/value It is imperative to mention that the weak compliance by DNFBPs, and indeed other challenges inhibiting effective implementation of preventive measures, is not peculiar to West Africa. A review of MERs of 17 African countries (eight countries in the Eastern and Southern Africa Anti Money Laundering Group region, five in GIABA region and three in the Middle East and North Africa region assessed under the current round as on October 2020, show a similar pattern of weak ratings under Immediate Outcome 4.

Purpose This paper aims to illustrate the feasibility of circumventing the Swiss financial sector’s compliance mechanisms by financing terrorism through hawala networks. Design/methodology/approach Based upon a qualitative content analysis of 15 informal interviews with providers of illegal financial services and 15 formal interviews with compliance experts and law enforcement officers, the general suitability of hawala networks for the financing of terrorism was assessed and concrete methods of doing so were better understood. In addition, it is shown how terrorists can limit their risks in using the services of hawala bankers. Findings Hawala banking in Switzerland is extraordinarily useful for the financing of terrorism. Research limitations/implications The findings are based on semi-standardized interviews limited to the perspectives of the 30 interviewees. Practical implications Law enforcement and intelligence agencies must be provided with additional tools, such as a broader scope of allowable activity for undercover police officers and the possibility of secretly conducting remote online searches of electronic devices. While this article focuses on Switzerland, its findings could be applied on a global level. Originality/value While the existing literature focuses on understanding the channels terrorists can use to finance their activities and on developing prevention mechanisms, this paper describes exactly how terrorism can be financed through hawala networks in Switzerland.

Purpose The purpose of this paper is to discuss the latest developments of anti-money laundering (AML) laws in terms of case law and to give meaningful response in relation to certain key findings (KFs) and recommendations by the financial action task force contained in its mutual evaluation report dated September 2019. Design/methodology/approach In terms of AML case law, the authors analyse the latest judgment from the Hong Kong (HK) court of final appeal. In terms of the evaluation report, the authors outline salient points from the KFs and recommendation, commenting on their likelihood of success. Findings With the developments in AML case law and the KFs identified, HK is expected to maintain its high standard in AML/counter financing of terrorism (CFT) compliance. Originality/value A robust AML/CFT regime is the bedrock of HK’s reputable status as an international financial centre. This study seeks to illicit meaningful interactions amongst all stakeholders.

Purpose The recent diplomatic split between members of the Gulf Cooperation Council (GCC) and Qatar with accusations of terrorist financing (TF). This paper aims to study Qatar’s domestic legislations, which specifically targets money laundering and TF activities. The country has stringently worked in compliance with international standards on combating financing of terrorism (CFT) and anti-money laundering (AML) practices by imparting autonomous power to regulatory bodies, such as the Qatar Central Bank and other agencies. Design/methodology/approach This paper studies independent legislations passed under the Emir’s decree over the past decade advancing Qatar’s AML ranking, with significant effort in CFT regulations. The paper also analyses the advancement in AML/CFT regulation and their validity with respect to international standards set by various governmental, intergovernmental and non-profit agencies. Findings The analysis finds Qatar in compliance with strong AML/CFT regulations. Further, it finds the government to have provided transparent oversight to international organizations that attest to the findings of the legislative efforts. This paper disproves claims and accusations that have possibly been presented to the GCC and subsequently led members to abruptly end diplomatic relations with Qatar over allegations of TF activities, amongst others. Originality/value The paper offers insight into Qatar’s legislative and regulatory advancement with respect to the AML/CTF in the past decade. The paper also discusses Qatar’s legislative advancement in relation to the evolutions of the country’s financial system, adopting a more robust mechanism to combat financing of terrorism and ML.

Purpose In June 2017, members of the Gulf Cooperation Council (GCC) ended diplomatic ties with Qatar. There is a legitimate concern about the accusation levied on Qatar. This paper aims to analyse the progress Qatar’s financial system has made with respect to its anti-money laundering (AML) and counter-terrorist financing (CFT) regulations, which further serves as the country’s effort to combating the financing of terrorism (CTF). The paper further wishes to advance the discussion by considering the legitimate goals of the aforementioned bodies and their discourse on creating national and international obligations towards reducing terrorist financing through robust AML frameworks. Design/methodology/approach The paper analyses Qatar’s legislative and regulatory overhaul following the Financial Action Task Force’s Mutual Evaluation Report. Qatar had distinctively strengthened its approach against Money Laundering and Terrorist Financing. The paper takes an ex ante approach by understanding Qatar’s “strategic deficiencies” before the FATF’s mutual evaluation. Subsequently, the paper studies independent international evaluations of Qatar’s AML/CTF legislation and regulation. Findings The paper finds Qatar in significant compliance to the recommendations of the various international bodies, including the Financial Action Task Force (FATF), Basel AML Index, IMF’s financial sector reviews, United Nations and independent reports on AML progress from regulatory bodies around the world. None of these organizations present obligatory rules but have set and determined and international standard for AML/CTF laws. Originality/value The primary aim is to draw parallels between Qatar’s regulatory AML and CTF efforts through the country’s compliance with international initiatives, such as the FATF guidelines, Basel AML Index, IMF’s financial sector reviews, United Nations and independent reports on AML progress from regulatory bodies around the world.