FATF Published Guidance Document for Precious Stones

The Financial Action Task Force has approved a detailed guidance document for the precious stones and metals trades. The Antwerp World Diamond Centre (AWDC) said in a release that it welcomed the move.

The document lays out how a more sophisticated a risk-based approach can be developed for those who deal in precious metals and stones, including the diamond industry. For the diamond business, this means that the specific concerns of the diamond industry will be taken into account more adequately.

Issues specific to the diamond trade addressed in the document include the physical inspection of diamonds at the official import-export offices, business with registered diamond dealers and bourse members, the Kimberley Process Certification Scheme for rough diamonds and a payment system through recognized and specialized banks.

AWDC notes that it was extensively involved in the consultation process that let to agreement on the guidance document, since the summer of 2007. The approval was announced at the FATF plenary in June.

FATF is an inter-governmental body that works to develop policies to combat money laundering and terrorist financing.

AWDC spokesperson Philip Claes commented, “We welcome the fact that, with its new guidance document, FATF has finally recognized the positive impact that the structure, regulation and supervision of the diamond trade in Antwerp has had in reducing money laundering risk.”

The Belgian government was also involved in finalizing and approving the FATF guidance. AWDC noted that it will work further with the Belgian authorities in establishing a more adequate and efficient money laundering regulation for the diamond industry, which will be based on the new FATF guidance document operate within the framework of Belgium’s implementation of the anticipated third EU directive concerning money laundering.

Source: IDEX

Federal judge dismisses SWIFT data protection lawsuit

A federal district judge Friday dismissed a breach of privacy lawsuit against the Society for Worldwide Interbank Financial Telecommunication (SWIFT). The Belgium-based international banking cooperative disclosed personal information about its customers to third parties, including the CIA and US Treasury Department. Ian Walker and Stephen Kruse said their privacy rights were violated because each had engaged in wire transactions that might have been processed by SWIFT, although neither disclosed his bank name. Judge T. S. Ellis III of the US District Court for the Eastern District of Virginia wrote:

There is no allegation that plaintiffs' bank or banks are members of SWIFT, nor is there any information indicating that plaintiffs' financial information was disclosed by SWIFT...Plaintiffs rely on their own belief that their financial information has been disclosed, but such a belief, without more, cannot support standing.

The ruling leaves open the possibility that Walker and Kruse could file an amended suit, naming their banks. AP has more.

The case began in federal district court in Chicago, but SWIFT moved to transfer the case to Virginia. The Department of Justice had considered invoking the state secrets privilege [JURIST report] to halt the lawsuit out of concern that it might reveal to much about SWIFT programs designed to prevent the financing of terrorism.

http://jurist.law.pitt.edu/paperchase/2007/10/federal-judge-dismisses-swift-data.php

EU sues 4 member states for failure to implement AML law

The European Commission has decided to refer Belgium, Ireland, Spain and Sweden to the European Court of Justice over non-implementation of an anti money laundering directive.

The 2005 legislation tightens the EU anti money laundering regime currently applicable to the financial sector as well as lawyers, notaries, accountants, real estate agents and casinos. The scope of the directive is broadened also to encompass trust and company service providers as well as all providers of goods, when payments are made in cash in excess of 15,000 euros.

In addition, the directive requires the application of the anti money laundering tools to the fight against terrorist financing.

European Union member states are required to transpose the legislation by Dec. 15, 2007.

Source: Xinhua