Head of financial intelligence unit resigns

The head of the financial intelligence unit at the central bank, Ibrahim Athif Shukoor, has resigned from the post.

Shukoor told local media yesterday that he had resigned on June 21 to work in the private sector.

He was appointed to the post in November last year by the governor of the Maldives Monetary Authority (MMA).

The financial intelligence unit was formed under the anti-money laundering and combating the financing of terrorism (AML/CFT) law passed in April 2014.

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Funds raised in Maldives to support terrorism abroad: State Department

The Maldivian government believes that funds are being raised in the country to support terrorism abroad, according to the US State Department’s 2013 country report on terrorism.

The report however noted the absence of “reliable information regarding the amounts involved.”

“While no official studies yet have been conducted, the Maldivian Central Bank believes that criminal proceeds mainly come from domestic sources, as a large percentage of Suspicious Transaction Reports (STRs) are related to Maldivians,” the report revealed.

“The Maldives Monetary Authority [MMA] reports that hawala systems (informal money transfer networks) are being used to transfer funds between the islands, although the extent to which these systems are used to launder money is still unclear.”

AML/CFT

While the government monitored “banks, the insurance sector, money remittance institutions and finance companies, and requires the collection of data for wire transfers,” the report noted that “financial institutions other than banks and intermediaries in the securities sector” were not subject to anti-money laundering/countering the financing of terrorism (AML/CFT) obligations in 2013.

Consequently, insurance companies and intermediaries, finance companies, money remittance service providers, foreign exchange businesses, and credit card companies “operate outside the AML/CFT framework.”

Moreover, non-profit organisations were not required to file suspicious transaction reports while such organisations were neither monitored nor regulated “to prevent misuse and terrorist financing.”

The report added that the government does however monitor and regulate “alternative remittance services”.

The government meanwhile “did not report any efforts to seize terrorist assets in 2013.”

Capacity building of regulatory bodies – MMA and the Capital Market Development Authority – and law enforcement agencies such as the police, Anti-Corruption Commission, customs and immigration, was needed to counter money laundering and terrorist financing, according to the government.

AML/CFT legislation drafted by the MMA was passed by the People’s Majlis last month and ratified by President Abdulla Yameen on April 13.

The new law introduced rules governing financial transactions and the inflow and outflow of money from the Maldives.

The bill was expedited by parliament’s national security committee at the urging of a high-level delegation from the Asia/Pacific Group on Money Laundering (APG), which warned MPs of “negative consequences” of failure to enact the legislation.

The absence of legislation “makes Maldives very vulnerable to money laundering and terrorist financing,” APG Executive Secretary Dr Gordon Hook told MPs in February. The vulnerabilities were identified by the International Monetary Fund (IMF) in a report prepared in 2011.

Radicalisation

The report further noted growing concern since 2010 “about the activities of a small number of local violent extremists involved with transnational terrorist groups”.

“There has been particular concern that young Maldivians, including those within the penal system, may be at risk of becoming radicalized and joining violent Islamist extremist groups. Links have been made between Maldivians and violent extremists throughout the world,” the report stated.

A counter-terrorism analyst previously involved in law enforcement told Minivan News today on the condition of anonymity that the most worrying aspect for the Maldives was the vulnerability of youth to radicalisation.

“Youth are vulnerable to organised crime as well, not just violent extremism,” he said, noting the absence of data or statistics as well as studies into radicalisation of youth.

On the efforts to counter violent extremism, the report noted that the government pursued counter-radicalisation initiatives last year.

“In 2013, the Ministry of Islamic Affairs conducted more than a dozen seminars and workshops on preventing violent extremism for religious leaders, educators, and local government officials,” the report stated.

While several people “possibly associated with violent extremism” were arrested during the year, the report noted that existing laws “severely limit” the prosecution of such cases.

As a result, it added, “the number of convictions was limited.”

The Maldives participated in the State Department’s Anti-Terrorism Assistance (ATA) programme while the US also provided training in “fraudulent travel document recognition” to over 100 immigration officers.

“Maldives has few laws that effectively control the movement of people and money in and out of the country. Due to its sprawling island geography and insufficient technological capabilities, the Maldivian Coast Guard currently cannot effectively patrol Maldivian waters,” the report observed.

The report also noted the installation of PISCES (Personal Identification Secure Comparison and Evaluation System) at the Ibrahim Nasir International Airport (INIA) as well as the Male’ seaport with US assistance in August 2013.

Meanwhile, earlier this week, the New Indian Express reported that a Sri Lankan arrested in Chennai on terrorism charges was also targeting locations in the Maldives.

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