East African government authorities and the private sector examine the vulnerability of alternative remittance systems to terrorist financing
CTED and the Centre for Global Counter Terrorism Cooperation held a regional workshop in Addis Ababa from 9 to 11 December 2013 on effective monitoring of alternative remittance systems (ARS) to prevent terrorist financing abuse.
Representatives from regulatory agencies, police and financial intelligence units of Djibouti, Ethiopia, Kenya and Somalia met with regional money remitters and associations of umbrella money service providers to discuss ways to improve compliance with counter terrorist financing requirements and to build more robust public-private partnerships to prevent the financing of terrorists or terrorist groups through ARS.
Experts from Afghanistan, Namibia, EUROPOL, the World Bank and the Developing Market Association Ltd. also participated in the regional event.
In conducting assessments and on-site visits on behalf of the Counter-Terrorism Committee in East Africa, CTED has become aware of the many challenges faced by Member States in their efforts to prevent the financing of terrorism through the misuse of ARS. For example, the level of compliance with anti-money-laundering and terrorist financing is strong in some locations but inadequate in others.
During the workshop, which is part of a global initiative, participants acknowledged the need for more capacity building on the licensing processes and monitoring of ARS. Enhanced coordination among Government agencies, including regulators and law enforcement agencies, was also referred to as a priority.
They agreed that it is important to have ongoing cooperation between the public and the private sector to ensure that the regulatory framework is well understood and takes into account the ARS sector's perspective. Such a constructive dialogue is paramount to avoid money-remitters operating underground.
The workshop also examined new ways to provide financial services to populations, including mobile-banking, which are increasingly used by money remitters especially in East Africa.
CTED expects to carry out these public-private sector partnerships discussions in other regions where remittance corridors are significant.