Suspending Suspicious Transactions

Abstract

According to World Bank and Egmont Group data, the financial intelligence units (FIUs) in at least 79 jurisdictions are authorized to postpone suspicious transactions related to money laundering, associated predicate offenses, terrorist financing, and or other criminal offenses. In response to a growing demand for reliable information about the legal and operational arrangements, and about practices and challenges relevant to the use of FIU power, the World Bank and the Egmont Group decided in March 2011 to carry out a joint study of FIUs to gather more information. This report presents the results of the study, which shows the existence of a wide range of practices and arrangements, and some gaps or omissions, in respect of a number of important aspects of the FIU power to postpone suspicious transactions. The study also indicates that only a relatively small proportion of FIUs with the power to postpone suspicious transactions are regular users of the power, while a substantial number have not used the power at all during the three-year period covered by the study, or have done so infrequently. This report presents a number of recommendations to help FIU practitioners and policy makers establish or strengthen effective legal and operational mechanisms for the postponement of suspicious transactions, while taking into account the international FIU standards, and the rule of law, in order to ensure that the fundamental rights of all those concerned are effectively protected. The recommendations highlight issues and associated risks identified during the study and are meant, among other things, to facilitate the development of training and technical assistance initiatives in regard to the use of the FIU power to postpone suspicious transactions. Finally, this report includes a number of sanitized cases provided by FIUs, and, where possible, examples of FIU legal and practical arrangements related to several recommendations. In addition, appendix D provides a template for a postponement order or notice, which FIUs may wish to use as guidance when drafting postponement orders.