Terror funding network pollutes financial systems, Italy's FinMin warns

2016-03-02 17:59:14 GMT2016-03-03 01:59:14(Beijing Time)  Xinhua English

ROME, March 2 (Xinhua) -- The financing of terrorism "pollutes" financial systems at the global level and must be addressed with particular attention, Italian finance minister Pier Carlo Padoan warned on Wednesday.

"We are dealing with a proliferation of an international network of terror funding that is polluting the financial systems, and thus requires great attention," Padoan said at a conference on money laundering organized by LUISS University in cooperation with Italy's financial police,the Italian Banking Association (ABI), and the national finance intelligence unit (UIF).

Economic globalization has increased the chance for financial systems to be exploited to support terrorist activities, according to Padoan.

"We find ourselves at a turning point unfortunately triggered by the tragic threat of terrorism, which has increased its aggressiveness and rapidly invaded the 'realm' of financial relations, especially at the global level," he warned.

"The complexity of this threat requires more cooperative efforts at the national and international level."

He added the topic was already on the agenda of several international bodies, such as the Financial Action Task Force (FATF), the International Monetary Fund (IMF), the World Bank, and the Counter-ISIL Finance Group set up in 2015 by the Global Coalition against the Islamic State (IS).

"Countering money-laundering and terrorism financing is also relevant to both G7 and G20 groups," Padoan added.

"Financial experts from the G7 recently gathered on the sidelines of a FATF meeting in Paris and identified new actions the G7 countries will commit to jointly undertake."

"Among them were a wider exchange of information, legislative actions on virtual currencies, and the strengthening of assets freezing mechanisms," he explained.

The European Union (EU) would also be building up its efforts in this area. "The Council of Economy and Finance Ministers (ECOFIN) on Feb. 12 welcomed an action plan presented by the European Commission which provided actions and initiatives," Padoan said.

Indeed, the ECOFIN's final statement called for EU countries to implement "rapid progress...in the field of virtual currencies, the strengthening of access to information, such as access to bank and payment account information, by FIUs, appropriate measures on pre-paid instruments, and measures against illicit cash movements."

Concerning Italy, the current major source of terror financing was self-financing from licit and illicit activities connected to minor crimes, Padoan said.

"Yet, I would like to remind the danger posed by terrorism funding cannot be measured only by the extent of the money amounts involved," he pointed out.

Italy was playing a leading role against global terrorism financing thanks to its expertise developed from tackling illegal domestic issues, according to the minister.

"We are a country at high risk, but we are also able to effectively mitigate these risks," Padoan said.

As an example, he recalled Italy's recently passed anti-self-money laundering law, which was positively assessed by both IMF and FATF.

"Still, much remains to be done: to the illicit networks that are being developed we must respond with a national and global counter-terrorism network," he stressed.

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