G20 is an international forum of developed and developing countries that are committed to economic cooperation. G20 member countries contribute around 80% of global economic output , two third of global population and three-quarters of international trade. The first g20 leader’s summit took place in 2008 when the whole world was undergoing an economic crisis. The 2020 leader’s summit was virtually held on 21-22 November owing to the global pandemic.
In the 2020 summit, the g20 countries reassured their commitment to the recommendations and policies of the financial crimes regulator FATF in combating money laundering, terrorist/proliferation financing. The g20 leaders declared their support for FATF’S paper on COVID 19. The global AML standard setting body reminded the g20 members in a written statement that offenders and corrupt politicians have been “misappropriating funds and misusing government contracts for personal gain”.
FATF is exceptionally stringent in framing policies and reviewing the AML/CFT framework of the countries however FATF reveals that majority of the countries fail to adapt necessary measures to combat financial crimes. FATF specified on the importance of strengthening the law enforcement agencies through adequate investments to detect corruption, the illegal fund movement and to detect the ultimate beneficial ownership (UBO) so that shell companies can no longer be exploited.
Money laundering itself being an offence fuels terrorism and other crimes. It affects the growth of the countries, the economy and completely erodes the integrity of the global financial system. FATF president Marcus Pleyer said, extracting the profits out of these crimes would protect people, the environment and the economy. He further emphasised that G20 members should set an example by acting against money laundering.
Author: Rajashree, MBA, CAMI
(PonSun AML Academy)