AML/CFT International Cooperation : The Egmont Group

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The Egmont Group of Financial Intelligence Units is an international organization that facilitates cooperation and intelligence sharing between national financial intelligence units to investigate and prevent money laundering and terrorist financing. Egmont Group's primary purpose is to help countries develop their national anti-money laundering systems. Egmont Group was established on 9 June 1995 at Egmont-Arenberg Palace, Brussels, and moved HQ Toronto, Canada in 2004. This unit is a unified structure that ensures secure financial transfer between Financial Intelligence Units at local and international levels. It consists of 166 Financial Intelligence Units (FIUs). Subject to international standards regarding AML / CFT and other binding rules applicable to Egmont Group members, both should engage in activities that encourage and facilitate international cooperation, such as the approved Basic Charter and Guidelines for Information Exchange Principles.


Source: APG Group of FSRBs

Egmont Group Definition:

A non-political, voluntary, international entity of operational Financial Intelligence Units (FIUs) committed to:

•        Provide a forum for FIUs to improve cooperation in the effective exchange of information to combat ML and TF.

•        Foster the implementation of domestic programs and promoting the development of effective FIUs.

 

 

The FATF 40+9 Recommendations call for countries to operate FIUs that meet the Egmont Group’s definition.


One of the key elements of AML/CFT regimes is the requirement for financial institutions and other designated non-financial businesses (DNFBPs) to report transactions they deem suspicious of being related to criminal or terrorist activity. Because of confidentiality traditionally attached to financial transactions and because reporting entities do not always have the means to substantiate their suspicion, it proves difficult to report it directly to the authorities in charge of enforcing criminal laws. It is therefore necessary for governments to establish a specialized agency, the Financial Intelligence Unit (FIU), focused on processing financial information that may be related to criminal or terrorist activity.


In their simplest forms, FIUs are agencies that receive reports of suspicious transactions from financial institutions and other persons and entities, analyze them, and disseminate the resulting intelligence to local law-enforcement agencies and FIUs to combat money laundering. As government agencies, FIUs must retain sufficient independence to accomplish their objectives without undue interference or influence.

 

FIUs are uniquely positioned to support national and international efforts to counter-terrorist financing. FIUs are also trusted gateways for sharing financial information domestically and internationally per global anti-money laundering and counter-financing of terrorism (AML/CFT) standards. The Egmont Group provides FIUs with a platform to securely exchange expertise and financial intelligence to combat money laundering, terrorist financing (ML/TF), and associated predicate offences.

Adding value: The Egmont Group adds value to member FIUs’ work by improving stakeholders’ understanding of ML/TF risks and draws upon operational experience to inform policy considerations, including AML/CFT implementation and AML/CFT reforms. The Egmont Group is the operational arm of the international AML/CFT apparatus.

Financial Intelligence Sharing and International Cooperation: The Egmont Group recognizes financial intelligence sharing is of paramount importance and has become the cornerstone of international efforts to counter ML/TF. FIUs around the world are obliged by international AML/CFT standards to exchange information and engage in international cooperation. As a global financial intelligence forum, the Egmont Group facilitates and prompts this exchange amongst its member FIUs.

International Standards Implementation: The Egmont Group supports international partners’ and other stakeholders’ efforts to implement the resolutions and statements of the United Nations Security Council, Financial Action Task Force (FATF), and G20 Finance Ministers.

 

The Egmont Group is structured to meet the AML/CFT challenges of its members, the volume and diversity of membership, and the organization’s workload.

  1. The Heads of FIU comprise the directors of all of the Egmont Group member FIUs. They set the goals and objectives of the Egmont Group and make many of the decisions for the organization.
  2. The Egmont Committee implements the mandate of the Heads of FIU. The Egmont Committee serves as a consultative and coordination body for the Heads of FIU, the Working Groups, and the Regional Groups within the Egmont Group. The Egmont Committee comprises, among others, the Egmont Group Chair, the two Egmont Group Vice Chairs, the Chairs of the Egmont Working Groups, the Regional Representatives, and the Executive Secretary of the Secretariat.
  3. The Egmont Group has eight Regional Groups for member FIUs. The Regional Groups provide an opportunity for FIUs to coordinate on regional issues and communicate with the Egmont Group.
    There are four Egmont Working Groups: Information Exchange; Membership, Support, and Compliance; Policy and Procedures; and Technical Assistance and Training.
  4. In 2018, the Egmont Group established the Egmont Centre of FIU Excellence & Leadership (ECOFEL) to provide specialized training, mentoring, coaching and other support to FIUs. ECOFEL is funded by the U.S. Department of State/Bureau of International Narcotics and Law Enforcement Affairs, among other donors.
  5. The Egmont Secretariat provides strategic, technical and administrative support to the Egmont Group and is located in Canada.

The Egmont Group meets at least twice a year either in person or virtually for the Egmont Committee and working groups, including the annual plenary session for the Heads of FIU, member FIUs, and observer organizations.

Egmont Group has formed working groups to take concrete steps in achieving the Goals. Egmont working groups and their duties are as follows;


The Legal Working Group


The Legal Working Group examines all legal regulations and discusses the candidacy of potential members. It also leads the preparation of official documents belonging to the Egmont Group.


Training Working Group


It is the group that collaborates with other organizations to coordinate technical assistance around the world. It organizes international and regional seminars for the needs of the financial intelligence units of the member countries.


Outreach Working Group


It conducts studies to expand and develop the global financial intelligence unit network. Providing the preliminary communication of the financial intelligence units that it will host, this unit's Egmont It makes evaluations that determine whether it is ready for membership.


Operational Working Group


It develops working methods by using the information gathered by financial intelligence units. It also plays a central role in promoting cooperation between operational divisions of member financial intelligence units. The Information Technology Working Group is a group that provides technical support to financial intelligence units. Carries out activities to facilitate electronic information exchange between these units. 


Egmont Centre of FIU Excellence and Leadership

The ECOFEL was created as an engine and hub to assist FIUs as they strive towards excellence and leadership. The ECOFEL’s goal is to protect, position, and promote FIUs within their national systems and internationally. The ECOFEL aims to:

  • Share expertise and best practices amongst FIUs
  • Build networks within the AML/CFT community
  • Introduce new and innovative tools for FIU operations and development
  • Strengthen cooperation with international partner organizations
  • Empower FIUs to position themselves domestically and internationally as leaders

Activities include mentoring, coaching, staff exchanges, specialized training courses, a reference library, E-Learning platform development, and other support mechanisms. The ECOFEL has been active since April 2018, is fully integrated in the Egmont Group, and is located within the Egmont Group Secretariat in Canada.


The Egmont Group and India


Shri Manoj Kaushik, Additional Director, FIU-India was elected to the chair of Egmont’s Membership, Support, and Compliance Working Group (MSCWG), 2020- 2022. This is the first time an Indian has assumed this prestigious office. The election enhanced the role of FIU-India in policy matters in the Egmont Group. It also reflects credibility of FIU-India globally and is a validation and acceptance of its practices and procedures. Shri Chaitanya Shukla, Additional Director, FIU-India was elected Vice-Chair in the Information Exchange Working Group (IEWG) of the Egmont Group of FIUs in the year 2022. Online meeting of Egmont Asia Pacific Regional meeting through VC was also attended by the Egmont vertical officers of the FIU-IND.




Happy Reading


Happy Reading,


Those who read this, also read on:

1.The AML/CFT:  International Cooperation

2.The AML/CFT International Cooperation: The APG Group

3.  Financial Intelligence Unit (FIU-Ind)

Formerly Faculty for Finance & Associate Dean, IBS-Kochi MBA (Banking & Finance – CUSAT);CFA. Accredited Management Teacher from CME of AIMA, Delhi has been in Management Education from 1988. Exposure is in the field of Mutual Funds, Market Research, Project Report preparation & evaluation, Advertising & NGO Activities. This Chief Manager, UTI Asset Management Co Pvt. Ltd(1992-2003), Mumbai. Undergone training in Case Study method of teaching under Mr. Trevor Williams and Mr. Scott M Andrews conducted by the ECCH, UK . Published Books & Book Review, Series of academic articles and maintains a column on MFs under "Fund scan" in Business Manorama since January 2007,Contributes "Portfolio Doctor" column for 'Sampadyam' a wealth mgt publication in Malayalam from manorama group since February 2007, Listed her case studies at asiacase.com.Presented papers in national & international conferences on Mutual Funds. Faculty Member @ ASIET, Kalady from 2010 to June 2019. Dean @ SNGIST, N Paravur, Ernakulam from Sep 2019 -Jan 2021, I continue my efforts to spread the knowledge in area of Finance and contribute to Management Education

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