Transparency International Wants Global Action Against Money Laundering

By Samuel Malik, Abuja

Transparency International, TI, the global organisation leading the fight against corruption, has called on governments around the world to synergise in order to effectively combat money laundering, which has plagued many countries, particularly  the developing world.

According to TI, despite abundant evidence, most investigations into money laundering have usually resulted in plea bargains and fines, thereby encouraging more of the illicit transactions.

According to Jose Ugaz, chairman of Transparency International’s board of directors, there is usually evidence of money laundered “but for the greatest part investigations have only resulted in corporate fines with almost no criminal prosecutions of individuals. Actions by national judicial authorities to end this criminal behaviour are largely absent.”

Ugaz believes that the lack of senior management accountability “sends a signal to the corrupt individuals and corporations laundering cash, and to their banks, lawyers and other agents who assist them in their crimes, that in this area there is impunity”, adding that “this is wrong.”

Transparency International’s call for more action on money laundering is coming on the heels of several reports that have put Nigeria, among other countries, in the spotlight regarding money laundering and corruption.

Nigeria is reportedly responsible for 60 per cent of the money that Africa lost to capital over the last decade, with $60 billion leaving the continent annually, according Illicit Financial Flow report adopted by the African Union.

Transparency International said those who engage in money laundering use intermediaries like bankers, accountants, real estate brokers, consultants and other professionals, who encourage and profit from it by concealing identities of criminals.

“Approximately 100,000 individuals and corporations held accounts at the Swiss branch of Europe’s largest bank, HSBC and investigations by the media have found many to allegedly conceal funds for tax evasion and others to harbour the alleged proceeds of corruption.”

“UBS, one of the two largest banks in Switzerland, confirmed on February 10 that it is being investigated by US authorities into whether it helped Americans evade taxes,” TI said.

Instead of fines and plea bargains, the watchdog said stringent sanctions such as prison time is crucial in discouraging the act, as fines can only embolden perpetrators.



    “Time behind bars for those who break the law, rather than settlements that shift the burden to shareholders, would signal a time to change,” Ugaz said.

    He equally observed that ending money laundering requires the cooperation of the financial sector, especially banks, noting that secrecy laws make them attractive to those interested in the crime..

    “Recent investigations in the US, UK and Switzerland in bank practices have put a spotlight on these issues,” TI said, adding that, “Banks need to oversee their employees and enforce higher ethical standards, which have to be reflected in the tone from the top, the performance management system and remuneration.



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