G-7 to crack the whip on money-laundering

FUKUOKA (JAPAN), JULY 8. The G-7 industrialised nations today said they would take tough new measures against international money laundering and may cut off some bank dealings with countries that do not halt hot money flows. ``We've named, we've shamed and we're taking measures to fight it,'' said the French Finance Minister, Mr. Laurent Fabius, at the end of a one-day meeting of Finance Ministers from the Group of Seven.

``I think it's a necessary trilogy if we want to rid ourselves gradually of this gangrene.'' The G-7 said it was endorsing a `hit list' of nations compiled by the Financial Action Task Force (FATF), which was established by the G-7 to investigate the international flow of money obtained through illegal activities, often drug running. The measures were a `landmark step' in showing a renewed commitment to curb money-laundering around the world, said the statement issued by the Finance Ministers from the U.S., Japan, Germany, France, Britain, Italy and Canada.

Ironically, the day's talks had included one of the potential target nations - Russia - for at least part of the discussions.

The FATF last month named 15 havens that it said were not doing enough to prevent the recycling of hundreds of billions of dollars in hot money.

Some $ 600 billions from drug cartels, mafia barons or other criminal outfits is believed to pass through banks each year - a sum close to the value of the entire Canadian economy, which is the world's seventh biggest.

Potentially more ominous for these countries was a warning in the statement from the Ministers at the end of a one- day meeting that those who do not clean up their act could find their international finance activities restricted.

- Reuters

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Section  : International
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