Saudi Arabia and Iraq have formed an alliance and signed an agreement to counter money laundering and terrorism. This agreement was signed at the Presidency of State Security between Iraq’s Anti-Money Laundering and Countering Financing of Terrorism Office, and Saudi Arabia’s General Directorate of Financial Investigation.
The Kingdom of Saudi Arabia is dedicated to preventing the laundering of money and terrorism crimes through the anti-money laundering law. This agreement continues to expand the country’s counterterrorism acts and aims to punish perpetrators.
A money laundering offence is considered as any of the following:
The possession or use of funds with knowledge that these are a result of criminal proceedings. Engaging in transactions with funds from criminal activities, with an aim to conceal the identity of the original source. Concealing the identity, locations, or movements of criminal activity proceedings.
The attempt to commit or participate in any of the above mentioned through agreements, collusion or assistance is deemed as a money laundering offence. Legal entities can also be held liable for money laundering should any of the activities be committed on their behalf.
Money laundering occurs in three stages;
Stage 1 The Depositing or Placement of money. This involves the introduction of illicitly obtained funds into the financial system. The deposits occur discreetly to avoid any suspicion or detection. This happens through financial institutions where a customer acting on their behalf, makes a financial transaction including the purchase of shares without taking preventative measures.
Stage 2 Layering. This is when funds are transferred and moved whilst concealing their origin. Actions may involve the sending of money through wire transfers to various financial institutions, terminating finance contracts and engaging in fraudulent investments.
Stage 3 Integration. Funds are now brought into the economy to make it hard to distinguish them from illegitimate funds. This is done to legitimatise funds and incorporate them into the domestic or global economy.
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