Cabinet set to okay tough new anti-money laundering laws

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Nazmul Ahsan The cabinet is set to approve a tough new anti-money laundering law today (Monday) to combat terror financing and recover money siphoned off unlawfully by militants, corrupt officials, rogue tycoons and any other citizen of the country. Official said the Mutual Legal Assistance Act (MLAA) 2011 will pave the way for bilateral agreements with foreign countries where the money has been stashed away so that illegally earned fund can be frozen or confiscated by the government. The ministries of finance and law have finalised the law and the Cabinet led by Prime Minister Sheikh Hasina is expected to give its consent in a regular weekly meeting at the Secretariat, a Cabinet Division official said. After the approval, the lawmakers will debate the bill and may adopt it in the winter session of the parliament, he added. "The proposed MLAA will be a major improvement from the existing money laundering laws, which though have helped fight terror financing, have failed to locate or bring back billions of dollars siphoned off in recent years," he added. "The MLAA will enable us get back the money, which has been laundered from Bangladesh to offshore financial hubs and foreign banks in the past," a senior MoF official told the FE. He said the enactment of the MLAA would enhance the country's image abroad and demonstrate the government's commitment to combat terror financing and money laundering by rogue officials and businessmen. "It will simply make it difficult for anyone to stash away illegally earned billions abroad," he added. Officials said the latest legal tools have been finalised taking into consideration the spirit of the UN Model Treaty on Mutual Assistance in Criminal Matters and SAARC Convention on Mutual Assistance in Criminal Matters. Wealth earned through corrupt means, terrorism or by any other illegal ways will come under the proposed act, according to the draft Act, a copy of which has been obtained by the FE. Assets or bank deposits of individuals, earned through illegal ways, could be seized or frozen under the MLAA, 2011, said the draft act. The confiscation or freezing may take place in case Bangladesh has an agreement with a country where the money has been laundered, it said. The official said the government initiated the move to enact the MLAA following pressure from two international anti-money laundering watchdogs-Financial Action Task Force(FATF) and Asia Pacific Group(APG) on Money Laundering. Both the organisations have been pressing the government since last year to enact tough new laws to combat money laundering and terror funding. The MoF in June, 2010 submitted an Action Plan to both FATF and APG, assuring them of passing the MLAA and adopting other measures to plug money laundering and terror financing. The government has also vowed to bring changes to Anti-money Laundering Act 2009 and Terror Financing Act, 2009 --- two key laws now being used by the central bank and local security agencies to track down source of funds of militants. It also pledged to include the issues of money laundering and terror financing in the existing Extradition Act, and ratify the UN Convention against Transnational Organised Crime (Palermo Convention) and sign the UN Security Council Resolutions 1267 and 1373. "We have finalised the MLAA in line with the government's commitments made to the international money laundering watchdogs including FATF and APG," the finance ministry official said. According to the draft Act, any verdict of a court of foreign nations on freezing or confiscation of assets of any particular individual in question will be honoured by other contracting state if the verdict does not contradict local laws. A central authority and an advisory board will be established under the proposed Act. The proposed authority will be vested with all responsibilities for any confiscation or asking foreign countries for freezing or seizing assets and bank deposits of any Bangladeshi in question, who is absconding to a foreign country. However, the draft act excluded provisions of any cooperation or assistance in military-related offence and political or religious grounds. Under the proposed Act, the central authority could exchange government documents with a foreign country related to confiscation, criminal activities or freezing.