Financial Crime World

IRAQ ESTABLISHES NEW OFFICE TO COMBAT MONEY LAUNDERING AND TERRORIST FINANCING

The Iraqi government has taken a significant step towards combating money laundering and terrorist financing by establishing a new office within the Central Bank of Iraq (CBI).

The Combating Money Laundering and Terrorist Financing Office

  • Has its own legal capacity and financial and administrative independence
  • Responsible for receiving and dealing with suspicious transaction reports from financial institutions and other commercial establishments
  • Represents Iraq in international organizations and conferences related to money laundering and terrorist financing
  • Exchanges information with foreign entities on a regular basis to combat these crimes

New Committee to Freeze Terrorist Funds

A new committee, the Committee for Freezing Terrorist Funds, has been established within the CBI. This committee will deal with the freezing of funds belonging to terrorists or individuals specified by the United Nations Security Council’s Counter Terrorism Committee.

  • Receives requests from foreign countries regarding asset freezing for Iraqi residents
  • Decides whether the request meets the necessary criteria

International Cooperation and Extradition

The new law also addresses international cooperation and extradition, allowing Iraq to offer assistance in combating money laundering and terrorist financing crimes. The law specifies that both countries must have a crime of the same nature before assistance can be provided.

Penalties for Money Laundering and Terrorist Financing

The new law introduces harsher penalties for money laundering and terrorist financing, including:

  • Imprisonment of up to 15 years for money laundering
  • Life imprisonment for terrorist financing
  • Procedural actions that can be taken against individuals or institutions that violate its provisions, such as the withdrawal of a license or restriction on the power of managers

Exclusion of Liability and Whistle-Blowing

The new law provides exclusion from liability for individuals who report suspicious transactions in good faith. However, it does not include whistle-blowing provisions.

  • Concerns among experts that employees may be reluctant to report suspicious transactions due to lack of protection
  • Offers further exemption from punishment to those who notify authorities of a conspiracy to commit a money laundering or terrorist financing offence before the crime is committed

Conclusion

The establishment of the Combating Money Laundering and Terrorist Financing Office and the introduction of new laws demonstrate Iraq’s commitment to combating financial crimes and complying with international standards. The country has been under pressure from the Financial Action Task Force (FATF) to improve its anti-money laundering and combatting the financing of terrorism regulations.

With the new law in place, Iraq is expected to make significant progress in addressing these issues and avoiding being placed on the FATF blacklist.