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How will the Island tackle financial crime?

Intelligence Unit unviels delivery strategy

The Island's offshore jurisdiction status has afforded us some heavy scrutiny in recent weeks, but amidst speculation about the ethics of low tax, there are more serious concerns. 

Criminals are using increasingly sophisticated methods to launder money, and support the financing of terrorism - with offshores' concentration of financial services making them a prime location to do so.

The body tasked with identifying these threats is the recently established Financial Intelligence Unit, which has just outlined its strategic delivery plan for the next year.

In 2016 MONEYVAL, a group of experts appointed by the Council of Europe which evaluates what measures a jurisdiction has to clamp down on money laundering and financing terror, and found the Island lacking.

It said we performed poorly in terms of gathering intelligence, in enforcing the law in respect of financial crime, and of actually convicting anybody or seizing ill gotten gains.

Chief Constable Gary Roberts went on record in 2017 to say dealing with the need for financial crime investigation was the force's biggest challenge considering stretched resources.

Recognising it's pretty poor not to be able to properly police your main, the Manx government, which has to report back to MONEYVAL by January next year, made some changes. 

These include creation of financial crime unit, an assest recovery unit and a new three year strategy, as well as increased funding for the body in question, the Financial Intelligence Unit.

It's only been operational for a year, but the statutory body, which has no power to prosecute, focuses on gathering and sharing intelligence related to terrorism and financing.

It's made up of 16 individuals; a board chaired by the Attorney General, a senior team under director Lindsey Bermingham, and 9 other officers and staff.

The Intelligence Unit is part of an informal network of 156 similar bodies in other countries which collect information on suspicious or unusual activity in the financial industry.

Companies can report any questionable information to the FIU through it's online reporting system, lodging incidence of suspicious activity.

It uses all this gathered, shared and analysed data to help detect, prevent and reduce crimes like money laundering and the financing of terror, by cooperating with police.

With criminals changing their activity with new and increasingly sophisticated methods, the FIU has released a Strategic Delivery Plan, which you can find in this month's November Tynwald paper, outlining its objectives for the next year.

These include addressing the 'cross-border' threats of money-laundering and terrorist financing due to the flow of funds in and out of the Island finance sector.

More training for staff, better use of technology, industry engagement and high quality cooperation with partner agencies are also identified as targets over the next year. 

So a range of areas for improvement for the FIU so it can gather, analyse and disseminate it's information more effectively.

As we heard Chief Constable Gary Roberts had said policing this area was a mammoth task, so what about intelligence gathering?

A section within the delivery plan is dedicated to resources - it says the Unit's budget must be increased to improve it's effectiveness, to enhance the Island's rep and act as a deterrent.

The FIU's budget for this year was decided before the it became fully operational.

The body therefore expects to be able to meet it's priorities, but not with out further revenue bids to Treasury - so put simply, it needs further funding to fulfil it's functions in future.

In a nutshell, the Strategic Delivery Plan, outline a list of ways the body can gather more, and do more with what it gathers - underlining all this is a need for further funding going forward.

But hopefully in a few months, when the Island has to report back to MONEYVAL, it can point to signs of improvement.

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