Financial Analysis Task Force taking on terrorist financing, money
Financial resources: Vulnerable to misuse
CLOSE TAB: Government established the Financial Analysis Task
Force (FATF) which outlined 40 recommendations covering counter measures
against money laundering, the criminal justice system, law enforcement,
the financial system and international co-operation, Chief Executive
Officer - Financial Intelligence Unit of the Central Bank of Sri Lanka
George Fernando said.
He said these recommendations have been recognized, endorsed and
adopted by most Jurisdictions. In addition to the above FATF has also
formulated a further 9 proposals specially directed to combat terrorist
financing and money laundering.
The FIU has established the administrative type of model as the unit
is attached to the Central Bank with close liaising with the Ministry of
Finance, Fernando said.
To meet international requirements, Sri Lanka has adopted the FATF
recommendations and promulgated three Acts, namely the Convention on the
Suppression of Terrorist Financing Act of 2005, Prevention of Money
Laundering Act No. 5 of 2006 and The Financial Transaction Reporting Act
No. 6 of 2006.
The establishment of the FIU was a key component under the FTR to
deter criminals from using Sri Lanka and its financial institutions for
money laundering and terrorist funding activity to reduce the risk of
the country being exposed to volatile economic and financial conditions.
FIU's vary from country to country but basically all have three core
functions, which are to receive, analyse and disseminate information to
combat money laundering and terrorist financing activity both at a
domestic and at an international level.
This model suits our needs as it acts as a buffer between the
reporting institutions, such as banks, finance house and other bodies
and the enforcement agencies; these being the Police agency and law
The advantage of this is that it acts as an interface between
financial institutions and other reporting sectors on the one hand and
also avoids the institutional link between the reporting agencies and
the law enforcement authorities.
Notwithstanding this the FIU will disclose all matters relating to
money laundering and terrorist funding to the agencies for enforcement,
It will deal only in matters within the arena of money laundering and
terrorist financing. The Unit has provided three reporting formats to
entities, which are, Suspected Transaction Report (STR), Cash
Transaction Report (CTR) and Electronic Funds Transfer Report (both
inward and outward) EFT for reporting purposes.
Hard copies of the CTR and EFTs have been sent to the institutions
and have required the institutions to develop, in-house, computer
spreadsheets to incorporate the information from the format into data
bases and forward these to the FIU for analysis.
The exception to this is the STR where all entities are required to
report matters in the given format. For the record there is no reporting
threshold for the STRs, he said. The data thus far received is analysed
by three analysts who have specialized knowledge in accounting and
Suspect transactions that require reporting involve any known or
suspected criminal violation committed or attempted by an individual or
a body of individuals who will be taken to the task for the benefit of
the country, he said.