OECD Warns That Scope For Financial Crime Boosted By Market Integration

by Ulrika Lomas, Tax-News.com, Brussels

20 May 2002

Following the two-day meeting of the OECD Council at ministerial level last week, OECD ministers released a statement detailing the issues discussed, and made recommendations under the general theme of 'Partnership for Growth and Development'.

In its Final Communique, released on Thursday, the Organisation for Economic Cooperation and Development warned that increased integration of international financial markets, and the growing use of new technologies has widened the scope for financial crime and abuse, and urged all member states to be on their guard.

'Money laundering, bribery, illicit tax practices, the misuse of corporate entities, and security fraud are often interlinked and challenge the integrity of the global economy,' the OECD warned.

OECD Ministers called on governments and regulators to ensure that internationally recognised financial standards of market surveillance are upheld in order to protect the interest of investors and shareholders alike, and revealed that they had agreed to move a planned assessment of OECD principles of corporate governance forward a year to 2004, in the wake of well-publicised cases such as the Enron collapse.

The FATF was praised in the OECD statement for its action on combating money laundering and terrorist financing, and it was agreed that: 'the OECD and the Financial Action Task Force...(will) strengthen their cooperation on areas of mutual concern, including ongoing work on combating tax crimes in accordance with the 1999 ministerial communique'.

Finally, perhaps with the publication last week of Transparency International's 'Bribe Payer's Index' in mind, OECD ministers called for vigorous enforcement of the multilateral body's anti-bribery convention, and called for a report from member states on gaps in anti-corruption policy in 2003.

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