The government has today unveiled its latest fraud-busting strategy to combat money laundering and the financing of terrorism.

Ministers have been working hand in hand with law enforcement agencies, policy departments and the private sector to draw up a series of measures and key priorities for the future to make the UK financial system more robust against international crime and terrorism.

HM Revenue and Customs (HMRC) has long claimed that money laundering, which often goes hand in hand with VAT carousel fraud, is rife in the IT industry, and has links to organised crime.

New measures unveiled today include:

• · An extra £1m to the Charity Commission to ensure it has the resources it needs to identify and disrupt terrorist exploitation of charities and protect donor confidence.
• The creation of a Treasury Asset Freezing Unit that will help the government act quicker in response to advice from law enforcement and security agencies.
• New steps to make financial tools a mainstream part of the UK’s approach to tackling crime and terrorism
• Further data-sharing between the public and private sectors and better pooling of intelligence between public authorities.
• Reinforced measures to tackle the abuse of money service businesses, including by replacing the current registration system with a licensing system, underpinned by a new action plan for HMRC
• Further steps to extend a risk-based approach to regulation – including the creation of a money laundering supervisors’ forum
• Reforms to reduce red-tape, including measures to simplify identification and due diligence checks within revised Money Laudering Regulations
• Fresh action at the international level to identify and tackle the most serious financial threats to international security

Ed Balls, economic secretary to the Treasury, who launched the new measures, said: “The government's over-riding goal is to protect its citizens and reduce the harm caused by crime and terrorism. The strategy published today sets out a comprehensive programme of financial measures, supported by UK-sponsored international standards that deter crime and terrorism; detect it when it happens, and disrupt those responsible and hold them to account".

Sir Stephen Lander, the director general of the Serious Organised Crime Agency (SOCA), added: "Tacking criminal finances and profits is central to SOCA's efforts to disrupt serious organised crime. We, therefore, welcome this strategy. It points to the results that have already been achieved and highlights the importance of Government agencies and private sector institutions working together effectively to address money laundering and terrorist financing. For our part, we are already actively pursuing that collaboration, and are looking to make full use of the powerful tools now available both to law enforcement and to regulators to undermine the criminal economy."

Further Reading:

Fraud explodes in 2006