At first glance, one may not think that NGOs are big players in the anti-money laundering (AML) space. One may assume that these are affairs best left to various departments, agencies and ministries of government. Yet, non-governmental organizations have truly been at the heart of the fight against financial crime from its very beginnings.
It only makes sense that non-governmental and international organizations were at the forefront of the development of global AML standards, for money laundering and many of the associated predicate offenses take place on an international scale. As a matter of fact, the evolution of AML was driven by the activity of these organizations and there are many notable moments in this evolution throughout recent history. For instance, Article 5 of the 1988 United Nations Convention against Illicit Traffic in Narcotic Drugs and Psychotropic Substances (often referred to as the “Vienna Convention”) brought the transnational movement of funds derived from drug trafficking into the spotlight. The 2000 Convention, also known as the “Palermo Convention” dug into defining money laundering and important legal standards and distinctions. This set the stage for countries all over the world to craft their national legislations to curb illicit money movements. Today, the U.N. Office on Drugs and Crime (UNODC) provides model legislation and countless other resources via their International Money Laundering Information Network (IMoLIN).
Perhaps the most well-known and well-established international organization in the AML space is the Financial Action Task Force (FATF). Currently composed of 37 member nations and 2 regional organizations, FATF is the true standard-setter for international AML. In addition to providing crucial information on money laundering typologies, it also can apply pressure on different countries by calling them out for failing to adopt sufficient measures against crime and money laundering. To facilitate operational efficacy in applying these standards, FATF works with nine FATF-style Regional Bodies (FSRBs) that focus on strengthening AML policies and practices in their respective regions. FATF also coordinates with dozens of observer organizations, such as the World Bank, the IMF and the World Customs Organization.
Finally, one of the most important weapons in the fight against financial crime is information and data. There are many NGOs that are central on this front. For instance, the International Consortium of International Journalists (ICIJ) made headlines with their diligent scrutiny of the infamous Panama Papers and, more recently, the FinCEN Files, which illuminated key elements and instances of money laundering, tax avoidance and transnational crime. Other notable organizations include the Organized Crime and Corruption Reporting Project (OCCRP), the Tax Justice Network (TJN) and Transparency International (TI) - all of which conduct invaluable research used the world over.
A few weeks ago, we wrote about the importance that the Corruption Perceptions Index ratings from Transparency International has in our work here at Sigma. Working with the information from this constellation of NGOs, we are proud to excel in synthesizing and operationalizing that data to provide valuable insights into the murky world of international financial crime.