Chairperson of the Global Compliance Institute (GCI) Martin Woods
The much-awaited mutual evaluation and assessment on Qatar by the global financial watchdog Financial Action Task Force (FATF) has been completed and the report is expected to be published in February 2023, an official has said. The FATF report assessed Qatar’s existing anti-money laundering (AML) and combating the financing of terrorism (CFT) regime and analysed all the country’s current laws and regulations related to AML/CFT. The report will also define Qatar’s efficiency and conformity with global recommendations.
Being well rated by the FATF, which sets the global international standards on AML/CFT is crucial, as this also affects investment prospects for countries being evaluated.
Speaking to The Peninsula on the sidelines of ‘The Effective Financial Crime Compliance Conference’ recently, Chairperson of the Global Compliance Institute (GCI) Martin Woods (pictured)said Qatar’s evaluation with FATF was already being compiled, and once it’s approved by the OECD and the FATF it will be published by February next year.
“There are 40 recommendations by FATF which countries can adopt. And countries including Qatar will have some specifics to their own country,” said Woods.
A financial crime expert with a wealth of experience as a detective who once investigated financial crimes including global frauds and money laundering, Woods has also cautioned firms here to remain alert against financial criminals such as fraudsters and money launderers.
As Qatar increasingly becomes an attractive investment hub, especially with the hosting of the FIFA World Cup 2022, the country is also an ideal target destination for financial criminals, according to Woods.
“Where investors go, launderers follow. Qatar is a land of opportunity, it is a land of evolution, development and investment. The idea of money laundering is money launderers seek to blend dirty money with good money to then generate what appears to be good money. And while football fans will come here in November and December, the money launderers and frauds may also be here. The social engineering of people to deceive and penetrate other people’s accounts is a global phenomenon. So the objective of the banks and the regulators and anti-money launderers is to filter money and stop the bad money from coming in,” Woods said.
To beat the money launderers, one must think like a money launderer, he added.
“Knowing your customer is one thing. But if your customer outwits you, then if the customer is a money launderer the money will have been laundered before you wake up. Take control. Don’t let customers dictate the terms and conditions of the business to you. Banks should actually be robust in the application of control,” Woods reiterated.
Asked if sanctions put in place by companies and governments worldwide are enough to deter financial criminals and stop financial crimes from proliferating, he said: “I believe that money laundering will be really challenged in a commercial context. I don’t believe the criminal law has been effective in countries like the United Kingdom. Nobody gets prosecuted for it really. In the NatWest case, nobody was prosecuted. The bank shareholders paid the penalty, but no individual paid the penalty. So there needs to be more accountability for organisations that launder money in a commercial context. The battle field is multiple, but the success will be from the application of commercial laws, then boards will certainly become engaged to prevent those losses to their shareholders”.
Globally, the COVID-19 pandemic has exposed companies which were vulnerable to fraud and financial crimes with stories of companies declaring bankruptcy due to bad financial management.
“Even if you go back to the global financial crisis of 2008, when the money runs out it leaves people exposed. And where there has been corruption and crime, all will likely be identified. And the question might well be, was it previously tolerated and why? Why did you tolerate it?” Woods asked.
He went on to explain: “That was not good business practice. And I would say to people who are employees in firms, you go to work to provide for your family. If you tolerate fraud by your colleague/s, maybe you will be out of the job one day and you won’t be able to provide for your family anymore. You have a responsibility to your family to not tolerate fraud by your colleagues, or by the people you deal with. Stand up for it, confront it, deal with it. You are much more likely to actually retain the job help your company prosper. Good business is conducted by good people in a good environment. And you need to not tolerate bad practice and fraud”.
Earlier during his presentation at the conference, Woods urged financial professionals to not let artificial intelligence (AI) replace them, but to work alongside with it. He also highlighted the need to maintain the integrity of the financial markets.
“Work alongside AI, make sure it complements you. What you have done as compliance officers and regulators is very important, and contribute significantly to potential positive outcome in regards to using technology to defeat the bad guys. Firms need strategy to win, and you need to know your opposition. If you have an effective anti-money laundering strategy, you will be compliant with the regulations. And it’s all about protecting your customers,” Woods added.
