Virtual currencies are used in money laundering and terrorist financing

Fri 02/Sep/2022 – 01:37

Counselor Ahmed Saeed Khalil, Chairman of the Board of Trustees of the Anti-Money Laundering and Terrorist Financing Unit, said: that The tremendous development that the world has seen in the last few years has greatly affected the field of information technology in various fields, and among the consequences of this development is the creation of virtual currencies that aim to enable its users to pay obligations electronically and transfer funds anywhere in the world without the need for an intermediary to handle operations Transfer of funds without being subject to the control of any party, with the difficulty of tracking operations, which can contribute to its exploitation in money laundering and terrorist financing operations, which require major efforts to deal with this phenomenon.

He explained during the Forum of the Union of Arab Banks to Combat Money Laundering and Terrorist Financing that Egypt developed the legislative framework to regulate trading in virtual currencies after conducting the necessary research and studies in this regard, as it prohibited under Egyptian law to issue, trade, promote or export cryptocurrencies without obtaining a license from the competent authority.

Khalil emphasized the need for anti-money laundering and terrorist financing systems to include preventive measures that financial institutions and other non-financial businesses and professions such as lawyers and accountants, who represent the first line of defense against money laundering and terrorist financing crimes, must implement; These measures include carrying out a self-assessment of risks, developing internal policies to combat, applying targeted financial sanctions, and taking due diligence measures, including adequate procedures to identify the true beneficiary.

He explained that knowing and verifying the real beneficiary is one of the important matters that the Financial Action Task Force focuses on, as many criminals hide their own identity and use other legitimate people as a front for their business, whether at the level of individual or commercial transactions, and the failure to identify the real beneficiaries of criminals leads to the continuation of their criminal acts and the laundering of their proceeds.

He said that international standards refer to the need to implement Security Council resolutions regarding terrorism, its financing and the financing of proliferation, and focused on the need for every natural and legal person to apply targeted financial sanctions without delay, while sanctions in case of non-implementation.

Mechanisms and procedures relating to the freezing of funds and assets

He continued: Egypt has established the necessary mechanisms to implement the targeted financial sanctions in light of Egypt’s membership of the United Nations and in response to international standards in this regard From the lists, and the manner in which a request can be submitted are for basic and extraordinary expenses from the frozen funds and assets, and a legislative amendment has been made to determine the penalties imposed on anyone who violates the obligations contained in the aforementioned mechanisms.

He pointed to the importance of the role played by the Financial Intelligence Units, as they analyze and disseminate reports of suspicious financial transactions they receive from all financial institutions and non-financial professions and businesses. To determine the patterns that follow become to commit these crimes. , which is what the Egyptian Anti-Money Laundering and Terrorism Financing Unit plays, in addition to another set of roles. This is an important element in promoting development.

A national strategy to combat terrorism and its financing

It is noteworthy that the Mutual Evaluation Report of Egypt, dated May 2021, indicated that Egypt has a good understanding of the risks of money laundering and terrorist financing to which it is exposed. The report is in cooperation with the Arab Republic of Egypt with other countries, which it describes as effective cooperation with various countries of the world; In addition, the report indicated that Egypt has adopted effective mechanisms to implement Security Council resolutions related to terrorism, its financing and the financing of arms proliferation; He also emphasized that the Egyptian unit has a great ability to directly and indirectly access a wide range of financial and intelligence information and other relevant information while looking into cases of money laundering and related predicate crimes and terrorist financing.

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