Wednesday, September 12, 2007

Money laundering in Armenia

With the arrest of the former Foreign Minister Alexsander Arzumanian (here) on money-laundering charges on May 8, 2007 money laundering has again drawn the attention of the Armenian government, as well as the European Union. It seems, the opposition block in Armenia, trying to raise money for the next Armenian elections could not help partaking of the illegal opportunities to make money.

The Government of Armenia (GOA) has made some progress in 2004 in bringing legislation and structural capacity up to international standards in the area of money laundering and terrorist finance. On December 14, 2004, the National Assembly adopted a comprehensive anti-money laundering law, "The Law on Fighting Legalization of Illegally Received Income and Terrorist Financing." This legislation consolidates old laws into a single piece of legislation, adds new regulatory structures, and specifically criminalizes money laundering and the financing of terrorism.

The new law is part of an anti-money laundering and counterterrorism financing package with which the GOA seeks to meet the recommendations of the Council of Europe (MONEYVAL), UNSCR 1373 requirements and the FATF Forty Recommendations. In addition to the new law, the comprehensive package includes amendments to 12 existing laws and the Criminal Code, affecting banking, credit and non-profit organizations, insurance, and gaming.

The new law designates the Central Bank of Armenia (CBA) as the single authorized body to coordinate anti-money laundering and counterterrorist financing activities in the country.
Financing of terrorism has been criminalized. The CBA has circulated to all banks lists of those named on the UNSCR 1267 sanctions list as associated with terrorist organizations and has instructed the banks to freeze their accounts.

Armenia is a member of the Council of Europe's Select Committee of Experts on the Evaluation of Anti-Money Laundering Measures (MONEYVAL). Armenia is a party to the 1988 UN Drug Convention, the UN Convention on Mutual Assistance in Criminal Matters, the UN Convention against Transnational Organized Crime, and the European Convention on Mutual Assistance in Criminal Matters. During 2004, Armenia became party to the UN International Convention for the Suppression of the Financing of Terrorism and the Council of Europe Convention on Laundering Search, Seizure, and Confiscation of the Proceeds From Crime.

It is however remarkable that national criminal prosecution for these crimes is rather arbitrary, targeted at opposition leaders in Armenia, rather than government members... The controversy behind the arrest of Arzumanian, who is an opposition leader, and his release last week show how political is everything... (here)

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