Business Irish

Sunday 11 December 2016

IMF reports Ireland's 'significant progress' in fighting money-laundering - but US points to our offenders

Simon Rowe

Published 02/10/2016 | 02:30

Former Central Bank director Peter Oakes
Former Central Bank director Peter Oakes

A report published by the IMF this week as part of a review of Ireland's financial sector says Ireland has made "significant progress" and has "substantially addressed deficiencies" in its fight against money laundering.

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However, former Central Bank director Peter Oakes has raised concerns over regulation of the payments sector following news that a Clare-based firm has been linked to a suspected international money-laundering network.

The PacNet group, a Canadian international payments processor, with an office in Shannon, is accused by US authorities of allegedly clearing money based on scams targeting vulnerable victims involving fake lottery wins, sweepstakes and letters from psychics.

The US Treasury Department claims that the PacNet Group has "a lengthy history of money-laundering".

It last week designated Canada's PacNet Group as a "significant transnational criminal organisation", and applied the designation to 24 firms in the group - including some in Ireland. It also sanctioned 12 individuals acting as directors or executives of those companies, including individuals based here.

Oakes, a former director of enforcement at the financial regulator with responsibility for anti-money laundering and counter-terrorist finance supervision, said: "The news of PacNet has raised eyebrows in the payments industry across Europe, particularly in London.

"Why, after 10 years of work by the Central Bank on anti-money laundering enforcement, has only 'significant progress' been made," he asks.

"Deficiencies were identified 10 years ago in an evaluation report. The report also notes that the Central Bank is still in the process of implementing international standards set in 2012."

Oakes, a founder of Fintech Ireland, who this week was appointed a non-executive director of fast-growing Irish firm TransferMate Global Payments, said the fintech sector faces reputational damage from such high-profile cases.

Responding to the IMF report findings, Central Bank Deputy Governor Cyril Roux said: "The report highlights the transformation of the regulatory landscape and supervisory approach that has taken place in recent years.

"We welcome the recognition by the IMF of the progress made since the financial crisis, note the further recommendations made and will consider them, in conjunction with other authorities as part of our ongoing work."

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