Money laundering aids movement of illegal products: TIPNG

By DALE LUMA
MONEY laundering is a major threat to PNG as these types of schemes can be used to facilitate the movement of funds derived from criminal activities, according to Transparency International.
Chairman Peter Aitsi told The National that examples of money laundering operations were the setting up of bogus businesses such as travel agents, car hire companies, road contractors or catering companies to act as a front to channel “public funds” under dubious and in most cases hugely inflated contracts for the benefit of corrupted networks.
“Of significant concern for PNG is the emerging presence of organised international criminal syndicates as evidenced in the recent the failed attempt to fly out a large quantity of cocaine, and also the discovery of large amounts of drugs washed up on beaches in Milne Bay,” he said.
“Money laundering is the movement of illicit money through what may appear to be legitimate third parties, they can be front companies or via trust accounts and in some instances through disreputable service providers who act as agents and retain a percentage of the proceeds for ‘washing’ the money.
“Our banks and finance companies who are regulated by the Bank of PNG have been required to increase their levels of compliance and as a result need to report all suspicious transactions.
“The Bank of PNG, as a member of the Global Anti-Money Laundering (AML) task force, is required to maintain a very high level of supervision and demonstrate its effectiveness in monitoring and enforcing actions against any suspicious transaction or conduct.
“There have been numerous claims and allegations of individuals siphoning off public funds and placing them into tax havens like the Cayman Islands.
“However, none of these claims have been proven to a point of enabling prosecution.
“In recent times, assets and accounts held by businessman Eremas Wartoto in Australia where seized and some of it sold off as part of a joint operation between PNG and Australian agencies.
“At the global level, because of the heightened commitment to enforce anti-money laundering regulations, we are aware there is more information being shared between global AML agencies and this is having an impact on multinational crime.
“In 2015, PNG was placed in a global grey list of countries that were assessed as being high risk due to weak enforcement and compliance.
“But, as result of good work and key improvements to our financial system regulations on the part of the Bank of Papua New Guinea, PNG was able to move out of the grey list in 2017/18.”