THOUGH Cambodia lacks the sophisticated institutions and oversight necessary to combat money laundering, corruption and a relatively low GDP make it an unattractive prospect to international launderers – at least for now – said a financial crimes and governance consultancy yesterday.
Speaking at the opening of a five-day workshop on anti-money laundering and countering financing of terrorism held by the International Governance and Risk Institute, former Netherlands central bank adviser Gert Demmink said that despite the Kingdom’s weak measures for preventing laundering, the same qualities that deter above-board investment would continue to discourage criminal investment in the form of dirty money until the country’s economy grew and formalised.
“Money launderers are investors. They are looking for stability; they don’t want to lose their money to corruption,” he said, noting that Cambodia’s comparatively small economy also made it harder for large financial transactions to be lost in the shuffle.
“If a money launderer were to bring $10 million into Cambodia . . . I think the central bank would notice,” he added
Demmink also noted that as Cambodia’s economy grows, so must its safe guards, saying that right now, “Cambodia isn’t on [launderers’] list, but eventually, you will be”.
However, National Bank of Cambodia Director General Ngoun Sokha said he was “not concerned about the risk of money laundering and financial terrorism, because we have established the Financial Intelligence Unit as a strong body for monitoring the issues”.
“We have strengthened law and regulation enforcement, and we have educated all banks to pay strong attention to this issue,” he added.
The intergovernmental body Financial Action Task Force, on the other hand, reiterated in a posting to their website last month that Cambodia was not “ensuring [the existence of] a fully operational and effectively functioning Financial Intelligence Unit” – among other things – despite having committed to do so nearly two years ago.
Preap Kol, executive director of Transparency International Cambodia, echoed the task force’s assessment, saying the Kingdom lacks “adequate legal frameworks and mechanisms for accountability and transparency” in its financial system.
“[The] Financial Intelligence Unit can be more reliable and effective only if the above mechanisms and conditions are in place,” he added.