Universidad Tecnológica de El Salvador
Islamic Finance and Anti-Money Laundering and Combating the Financing of Terrorism (AML/CFT)
Report

Islamic Finance and Anti-Money Laundering and Combating the Financing of Terrorism (AML/CFT)

Nadim Kyriakos-Saad, Manuel Vasquez, Chady El Khoury and Arz El Murr
IMF, 2016
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Editorial Rating

8

Qualities

  • Analytical
  • Innovative
  • Eye Opening

Recommendation

The global financial system has identified and implemented measures against money laundering (ML) and terrorist financing (TF). But international experts have not extensively studied how such risks may impinge on Islamic finance. The criminal exploitation of gaps in safeguards among nations can pose threats to the global financial infrastructure. No evidence suggests that Islamic finance faces ML/TF risks that differ from those confronting traditional banking, but this does not necessarily mean that precautions in one system will translate effectively to the other. This enlightening report from the International Monetary Fund provides a robust analysis that identifies some of these potential hazards, and getAbstract recommends it to policy makers and financial professionals.

Summary

Experts today have a solid understanding of how money laundering (ML) and terrorist financing (TF) activities operate in and threaten the mainstream financial system. The Financial Action Task Force (FATF) is an organization of international policy makers that sets laws governing ML/TF countermeasures. The enforcement of these rules, however, depends on the strength of a country’s legal institutions, as well as its willingness and ability to comply with FATF protocols. Wrongdoers can exploit nations with weak enforcement, thereby endangering their capital flows, ...

About the Authors

Nadim Kyriakos-Saad et al. are legal and financial experts at the International Monetary Fund.

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