The EU Global Facility leads the way on Anti-Money Laundering and Counter Terrorism Financing in 2020

Launched as the European Commission’s operational tool to provide demand driven support to third countries based on the deficiencies in their AML/CFT regimes, the EU Global Facility on Anti Money Laundering and Countering the Financing of Terrorism (EU GF-AML/CFT) is one of the most unique technical assistance entities in the field, both in its thematic scope and geographic range.

“We bring a truly new approach to the field by implementing activities all over the world. While we act on behalf of the European Union to support jurisdictions identified as ‘high risk’ based on EU and Financial Action Task Force (FATF) standards [1], our scope is global. This is different from most existing projects, which tend to focus on a specific region,” explains EU GF-AML/CFT Team Leader, David Hotte, who has more than 25 years of experience in anti-money laundering and counter terrorism financing.

COVID-19: a state of the art response

In March 2020, the EU GF-AML/CFT was on the verge of scaling up its technical assistance activities to various parts of the world when the COVID-19 pandemic hit. Forced to cancel all of its scheduled on-site visits, the facility swiftly re-engineered its work approach, developing a robust e-training catalogue composed of 118 modules over the course of the first lockdown.

The unique e-catalogue, which covers all aspects of the AML/CFT prevention, investigation and penal chain, as well issues relevant to civil society organisations and media, was launched shortly after, on one of the first online training platform active during the pandemic.

“This was one of the quickest and most efficient response witnessed in the field of online training,” explains David Hotte, who attributes it to “the incredible work of our core team of experts based in Brussels, supported by more than 50 short term experts worldwide.”
 

 The e-training bore fruits immediately

Nick Shah, a senior expert in law enforcement and the judiciary working as a mentor and training coordinator with the facility, remembers how “unsure” of how impactive this form of training would be at first. “But the e-training bore fruits immediately. Starting with one country, the online capacity building sessions quickly expanded to many more, with a successful track record so far.”

As the world struggled to cope with the disruption caused by the pandemic, the Global Facility managed to turn technical difficulties into tangible achievements, integrating its distance training component as a core aspect of its work. The e-catalogue, initially produced in response to the COVID-19 crisis, will continue to be implemented when on-site missions resume.

In parallel to the e-training, the project also sent two of its experts to Mauritius for a technical assistance mission in August 2020, becoming one of the first EU-funded project to resume its on-site activities during COVID-19. “We managed to deliver technical assistance to various parts of the world, while most of the world was still at a standstill,”  David Hotte recalls, stressing that “this testifies to the flexible, pro-active and resilient nature of the Global Facility.”

The pilot mission, which came as a result of a three-phased scoping assignment carried out between September 2019 and February 2020, sought to support the Mauritian authorities to strengthen their AML/CFT regime [2]. It encompassed mentoring support to the police force of Mauritius, followed by support to enhance the Gambling Regulator’s AML/CFT capacities, as well as activities to increase authorities’ transparency and beneficial ownership of legal persons and legal arrangements.

The project’s pro-active response to the pandemic was officially acknowledged by the European Commission, which increased the facility’s total budget from 16 150 000 to 20 150 000 euros, prolonging its duration until June 2023 (instead of the initial end date of September 2021).

Connecting the dots

Operating on the motto “a chain is only as strong as its weakest component”, the Global Facility’s work is structured around three key pillars: regulation, judiciary and the civil society, and law enforcement.
 

 A chain is only as strong as its weakest component

For Arnaud Stien, the facility’s key expert on regulation, “tackling the regulation aspect of AML/CFT regimes is complex but crucial. Crucial because it covers so many actors across the financial intelligence chain who must be able to detect and identify suspicious activities by playing this role of sentinel and catalyst of information.” With more than 15 years of experience in AML/CFT as a senior Banking Supervisor, Head of AML/CFT unit for a financial institution, and Payments, Arnaud Stien acknowledges the importance of connecting “a state of the art detection to ensure effective investigation”.

“This process is complex because of the diversity of the actors: reporting entities, supervisory/regulatory authorities and financial intelligence units. Our role as a technical assistance facility is to unite all these actors to speak a common language and cooperate more efficiently. And we do that through a key common vector: the AMLCFT risk analysis methodology.”

The importance of cooperation is also emphasized by former Ambassador Mamuka Jgenti, a senior expert with over 25 years of experience in EU institutions, legislation in the criminal field and AML/CFT, who acts as the Global Facility’s key expert on judiciary and the civil society. 

On the role of the judiciary in the AML/CFT system, he stresses the importance of cultivating a constant dialogue with and between all actors in the penal chain. “A chain is efficient only when combatting money laundering and terrorist financing culminates in the court of law. The AML/CFT measures can only be regarded as successful with efficient prosecution and conviction of criminals by the judiciary.”

A pioneer in the field

The EU GF-AML/CFT has also garnered widespread attention for its pioneering approach to the AML/CFT topic, putting some under-researched areas back into the spotlight.

“We are breaking new grounds by tackling topics that have not been so popular in the mainstream approach as well as emerging threats linked to the latest world developments,” explains law enforcement key expert Tim Hanley, a former Detective Chief Superintendent who established the first-ever Terrorism Investigation Unit in the Police Service of Northern Ireland. The facility’s thematic approach to AML/CFT law enforcement includes innovative training on blood antiquities, conflict looting, canine cash detection, pharmaceutical fraud and prison financial intelligence, among others.
 

 Cash is king for terrorists. We want to support regimes that are able to trace this cash.

“Terrorists and organised crime groups adapt incredibly quickly to law enforcement techniques, so we have to constantly review what the current ML/TF patterns are. This is where our topical areas of expertise come into play,” Tim Hanley says. “Cash is king for terrorists. And we want to support regimes that are able to trace this cash so these groups cannot operate so easily.” As of December 2020, the facility had produced more than nine concept papers and regulatory recommendations on specialised topics ranging from crypto-currency, financial abuse in the NPO sector, micro-finance and judiciary AML/CFT.

“These are topics that appeal to a lot of third countries, especially given the level of technicity that we are able to deliver,” explains Benjamin Bricheux, the facility’s project coordinator, noting that the training on Ultimate Beneficial Ownership and Recommendation 8 [3] have been particularly demanded.

“Recommendation 8 on non-profit organisations is one of the most difficult FATF recommendations to comply with [4],” explains Amb. Mamuka Jgenti noting that “the Global Facility (with the active engagement of the Global NPO Coalition on FATF) is promoting result-oriented dialogue between the state actors and civil society organisations to better understand the recommendation and therefore, ensure the better compliance.”

As of December 2020, the facility had produced more than nine concept papers and regulatory recommendations on specialised topics ranging from crypto-currency, financial abuse in the NPO sector, micro-finance and judiciary AML/CFT.

A groundbreaking approach

Between March 2020 and December 2020, the Global Facility delivered over 38 country specific and regional training, reaching some 842 participants.

It conducted 25 outreach missions in countries as diverse as Egypt, the Philippines, France, Bahrain, Kyrgystan, Turkey, Panama and Spain, among many others. Meanwhile, meetings with key stakeholders were also arranged in Bangladesh, Kenya, Mauritius, Zambia, Georgia, Jordan, Republic of Moldova, Bhutan, Mongolia and Jamaica.

“These numbers are absolutely unprecedented,” remarks Benjamin Bricheux, who cites “weeks with more than 6 simultaneous modules delivered to up to four countries at the same time.”
 

But these impressive figures do not paint the whole picture, he insists, as the central aspect of the facility’s work is built around dialogue and continual improvement. “We are not simply trying to ‘tick boxes’. Rather, we strive to establish a sustainable, qualitative two-way street partnership with third countries’ authorities, which helps us best understand their needs, expectations and specific objectives.”
 

 We also translate that through cross-fertilisation in training

“We also translate that through cross fertilisation in training, which means that we use the experts trained in one country for activities implemented in new countries, keeping in mind the unicity of each training.”

Working in close collaboration with the main AML/CFT institutions, the Global Facility also ensures that the EU principles of subsidiarity and complementarity are translated into concrete terms. “Before intervening in a country, we consider all the technical assistance already implemented by other programmes, in order to avoid duplication and to best tailor our activities,” David Hotte notes.

Having exceeded all of its initial objectives for the year, the team is well under way to becoming a centre of excellence in the field of AML/CFT. With many more activities lined up for early 2021, the EU Global Facility has proven that flexibility and collaboration are at the heart of a successful AML/CFT equation.

The EU Global Facility on Anti-Money Laundering and Counter Terrorism Financing is managed by the European Commission’s Service for Foreign Policy Instruments (FPI) and implemented by Expertise France, in partnership with the Deutsche Gesellschaft für Internationale Zusammenarbeit – GIZ and Northern Ireland-Cooperation Overseas – NI-CO.

This article is the sole responsibility of the EU GF-AML/CFT and does not necessarily reflect the views of the European Union.

Find out more about the Global Facility