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Following is the speech (English only) by the Chief Secretary for Administration, Mr Donald Tsang, at the Opening of the Plenary Meeting of the Financial Action Task Force on Money Laundering at the Hong Kong Convention and Exhibition Centre today (January 30):
Madame President, distinguished delegates, ladies and gentlemen,
First, I would like to welcome all delegates, particularly those who have travelled far to attend this Plenary Meeting of the Financial Action Task Force - the first ever to be held in Hong Kong.
There was a point immediately following the terrible events of September 11 when many people felt that air travel - or, indeed, any form of travel - would take a long time to return to any semblance of normality. While full normality in air travel hasn't happened yet, I think we can all take heart from the fact that the world is gradually recovering from the trauma of that fateful day.
That tragedy has galvanized a united front on an almost unprecedented global scale to fight terrorism. And to fight international criminal organisations linked to terrorism, the most potent weapon is to cut off their lifeline - their sources of funding.
The Financial Action Task Force on Money Laundering has long been the world's leading organisation in countering money laundering by criminals trying to hide their illegal gains. Your 40 Recommendations are by far the best and most comprehensive standards accepted by the international community as effective measures to prevent and combat money laundering. The Non-Cooperative Countries and Territories initiative has proved extremely useful in prompting those countries lagging behind in international standards to improve their anti-money laundering regimes.
Indeed, the impact of the Task Force's work in recommending best anti-money laundering practices and promoting the anti-money laundering message worldwide has been both far reaching and profound. The work you are doing is instrumental in suppressing transnational crimes. And, I would like to take this opportunity to pay tribute to all your members for their hard work and commitment in achieving these worthy goals.
Nowhere was this more evident than in the action you took at the extraordinary plenary meeting in Washington last October. Flowing from that meeting was an agreement to expand the FATF charter beyond money laundering and focus members' energy and expertise on the new and urgent global effort to combat terrorist financing. The Eight Special Recommendations adopted at the meeting were designed to deny terrorists and their supporters' access to the international financial system.
Much progress has been made in the three months since then. According to US reports, more than 140 countries have issued orders freezing the assets of suspected terrorists and organisations, and the coalition against terrorism has continued to gather support from governments around the world.
In a more telling way, recent events in our own region and elsewhere have reminded us that we must never lower our guard against the threat of extreme action by terrorist groups and their sympathisers. So, it is incumbent on international organisations such as the Financial Action Task Force to continue to act as a global watchdog.
This is an enormous task - you could say it's almost a 'mission impossible', when considering the amount of money laundered throughout the world is estimated to run into hundreds of billions of US Dollars.
Nevertheless, the policies that the Task Force has developed and promoted to counter money laundering are beginning to frustrate the activities of criminals and their organisations. Using Hong Kong as one small example, a total of some HK$2.3 billion or over US$290 million in assets has either been restrained, confiscated or recovered in recent years. This is the direct result of action taken by our authorities under the Drug Trafficking and Organised and Serious Crimes legislation. And when our statutory framework is further strengthened, we expect to be able to cut off even more avenues for laundering money.
We realise that Hong Kong, as a major international financial centre and arguably the world's freest economy, must rely on the integrity of its financial systems and its robust and comprehensive anti-money laundering regime.
We are continuously sharpening these tools through legislation, law enforcement, monitoring of financial and other institutions and public education. These initiatives progressively tighten the screws on those involved in this insidious task. And a bill is currently before our Legislative Council to do just this.
As far as specific anti-terrorism measures are concerned, our self-assessment shows that our existing legal framework already complies with a number of aspects of the Task Force's Eight Special Recommendations. But more needs to be done. We aim to achieve full compliance within months.
I won't go into the specifics here this morning. Suffice to say that we are moving ahead with legislative proposals to comply with the UN Security Council Resolution 1373. That Resolution is designed to prohibit the financing of acts of terrorism, freezing and seizing terrorist assets and preventing people from supporting, or being recruited by, terrorist groups.
The question that needs to be addressed by all jurisdictions is to ensure that we are not diluting the civil liberties of our citizens under the guise of fighting a worldwide menace. A balance has to be struck between the need to adopt tough measures to eliminate the scourge of terrorism and the need to protect civil liberties.
I am sure many of you here at this plenary session are familiar with what I am saying and the fine line legislators have to tread when debating anti-money laundering measures. Indeed, we are experiencing this dilemma right now in Hong Kong.
I understand the Task Force is now assessing members' compliance with the Eight Special Recommendations : and you will be developing special guidelines for financial institutions to strengthen their controls and monitoring procedures, such as preventing corporate business entities from being used to bypass established money laundering controls : and addressing issues of laundering money through internet financial services and e-money. And you are also reviewing the 40 Recommendations to see how effectively these function as an instrument against terrorist financing.
Madame President, and delegates, you do have a long agenda to get through over the next few days, and I don't want to keep you from getting down to this important work. However, I would like to conclude by quoting the words of former US President Bill Clinton in a speech marking the 50th Anniversary of the United Nations in 1995. In that particular message he said: "Criminal enterprises are moving vast sums of ill gotten gains through the international financial system with absolute impunity. We must not allow them to wash the blood off profits from the sale of drugs from terror or organized crime."
Now, seven years down the road, we have made substantial progress in breaking the back of money laundering. But new threats have arisen, in the form of terrorist attacks of unprecedented scale. Tackling money laundering in support of such heinous acts remains one of the greatest challenges facing the civilised world. A lot of work needs to be done, but I am sure all of us gathered here today in this forum will be able to do it well.
Thank you.
End/ Wednesday, January 30, 2002
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