The Impact of Predicate offenses and its Antecedents: Corruption, Money laundering, terrorist financing, bribery and illicit Drug Trafficking...

A keynote address 
By Tiawan S. Gongloe
At a one day symposium organized by CAMTEFIL

The Perspective
Atlanta, Georgia
April 27, 2014

                  


Tiawan Gongloe
The Impact of Predicate offenses and its Antecedents: Corruption, Money laundering, terrorist financing, bribery and illicit Drug Trafficking on the Fundamental Rights and governance system of the Liberian people- a keynote address  by Tiawan S. Gongloe, at a one day symposium organized by CAMTEFIL under the theme: Capacity Building and Sensitization Campaign against Money Laundering, Illicit Drugs and Terrorist Financing in Liberia, held at the YMCA Auditorium on Crown Hill, Friday, April 25, 2014 at 9: AM.

 Officials of Government, the National Director of CAMTEFIL, heads of CBOs and CSOs, the representative of OSIWA, other distinguished ladies and gentlemen.

You have asked me to deliver a keynote address under a theme that requires a greater length of time just for the key to be located. As for the notes, I could take a whole week to write and I will still need more time before delivering same to you.

Let me first congratulate CAMTEFIL for undertaking an initiative that is so important for protecting Liberia against becoming a paradise for transforming money generated from criminal conduct into good and clean money. Your effort to educate policy-makers, key actors in the banking and commercial sectors as well as in the civil society will go a long way in creating the knowledge required in Liberia to deal with the danger posed by money-laundering. It has been true throughout history and it is true today that knowledge is power. Thank you for helping the Liberian people, through your awareness creating project, to get the power they, so urgently, need to fight money-laundering.

What is money laundering?Money laundering is the process of taking the proceeds of criminal activity and making them appear clean and legal. Those notoriously known for money laundering in the world are drug traffickers. They generate so much money from this criminal enterprise and their intention is to put the proceeds of their criminal conduct in the financial system in the same manner as people engaged in legal business activities. It is easy to do this in countries that do not have limitations on how much money a person is allowed to carry on his person through a border or to deposit at one time in a bank. Money-laundering is not just restricted to drug traffickers. People engaged in white-color crimes such as corrupt public officials do the same thing when they convert public money to their own or take bribes, also engage in money-laundering. They like drug traffickers, also find ways to make their dirty money clean. Some put the volume of the proceeds the crime of money-laundering around the world at hundreds of billions of dollars, and may be a trillion dollars, annually.

Let’s look at some examples of money-laundering. A drug trafficker has millions of dollars that he wants to deposit in the bank in country A, but he cannot do so because the banking law of that country requires banks to ask questions on the sources of money deposited, once the deposits go beyond a certain limit. So in order for a drug trafficker to put himself in a position to explain the sources of his deposits, he may put the money into business ventures and then justify his deposits as proceeds from his business ventures. A drug trafficker or a corrupt government official could open a night club, a big farm, a transport business, a petrol station or jewelry business, or engage in the buying and selling of diamonds, etc. and by that transform his illegal money into clean money. Sometimes you see a person engaged in a small business, such as a night-club or a small commercial farm and within a short time he starts showing off his wealth and you then get inspired by that person and you go ahead and borrow money from the bank to carry on the same business in order to live like him, but you find yourself not succeeding. The real story in a situation like that is that the business that you admire so much is a front for the ill-gotten wealth or the means by which criminal money is made good money. Money-laundering works in more sophisticated ways then the examples that I have given. But this is just to give you an indication of how it works.

Money-laundering is not good for any country. It has numerous bad effects on any country. The first is that if drug-traffickers find themselves in a country where the proceeds of their criminal activities can be easily transformed into good money, they will bring in more drugs and more and more young people of that country will be exposed to drug addiction. The more the young people are exposed to drugs, the more they will commit violent crimes such as aggravated assault, rape, armed robbery, murder, and all kinds of organized crimes. This is not good for any country. Another effect of money-laundering is terrorism. In countries where money-laundering is not tracked, terrorist find a safe-haven for better organizing themselves because it is easy for them to raise money to support their criminal activities. Another negative effect of money-laundering is more and more corruption. If corrupt public officials can easily deposit and withdraw money without being questioned and there is no law on how much money one can deposit within a day, then public officials will easily deposit proceeds of conversion of public funds into private funds and bribes taken by them, in local banks easily. This means that government will not be in the position to provide the needed social services for the people due to the criminal conduct of public officials. Another negative effect of money-laundering is that, people who have clean money tend to move their money from banks in which laundered moneys are deposited. This tends to create liquidity problem in a country where money-laundering is not an issue or is not closely monitored.

There are many more negative effects of money-laundering than I have enumerated. The fight against money laundering is therefore, morally justified. But it cannot succeed without the collective efforts of the government, particularly its law enforcement officers, the business sector, particularly, the banks, and the citizens. The first step in this fight is to have a strong law against money laundering. Liberia now has a strong anti-money laundering law. It is called the Anti-money laundering and terrorist financing Act, 2012. This law came into force on May 2, 2013. Under this law, “a person or body corporate, or other legal entity commits the offense of money laundering if that person or entity knowing or having reason to believe that a property is the proceed of a crime:

  1.  converts or transfers the property with the intent of concealing or disguising the illicit origin of that property, or of aiding any person involved in the commission of the criminal conduct to evade the legal consequences of the conduct;
  2. Conceals or disguises the true nature, origin, location, disposition, movement or ownership of the property;
  3. Acquires, possesses or uses the property;
  4. Engages directly or indirectly in any transaction which involves the property;
  5.  Receives, possesses, conceals, disguises, transfers, converts, disposes of , removes from or brings the property into Liberia; or
  6. Participates in, associates with or conspires to commit, attempts to commit or aids, abets or facilitates the commission of any of the above acts.”

The offense is graded as a felony of the first degree.
Money laundering can be committed through the commission of other crimes. These crimes are referred to under the law as predicate offenses. They include fraud, terrorism, forgery, bribery, corruption, and many others.

In order for the law against money laundering to be effective, the Legislature has also enacted other laws to complement it. They include: An Act to Amend the Civil Procedure Law to Provide Provisional Remedies for Proceeds of Crime; the Fraud Act, 2012; An Act to Establish The Financial intelligence Unit of Liberia, 2012; An Act to Amend the Penal Law Regarding Extortion, Environmental Crime, And Illicit Trafficking in Human Beings And Migrant Smuggling, 2012; An Act to Establish Procedures for the Distribution of United Nations List of Terrorists and Terrorist Groups, 2012; and Mutual Legal Assistance in Criminal Matters Act, 2012.

I hope that in your subsequent workshops, you will bring lawyers and law enforcement experts to provide education on the importance of these complementary laws.
With these few words, I wish you a successful deliberation.

Thank you.

 

Philip Blidi
Mr. Gongloe,thanks for the class room lecture on Money Laundering. My question is, does Liberia has the capability to fully implement a strong anti-money laundering law, without Law Enforcement Officials and Officers not compromising, by means of corruption, with those committed such crime?
Philip Blidi at 12:29AM, 2014/05/08.

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