Turkey urged by int’l watchdog to improve fight against money laundering, terrorist financing: report

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Turkey has been warned by an international watchdog to improve “serious shortcomings” in its approach to combating money laundering and terrorist financing or face being added to an international “grey list” — a step that could damage its ability to attract foreign financing, Financial Times reported.

The warning by the Financial Action Taskforce (FATF) comes in a report by the body, published on Monday, that found the country lacking in a series of standards. 

Ankara will be now subject to special monitoring by the organization, which was founded in 1989 to combat to combat money laundering, terror financing and other similar threats to the integrity of the international financial system.

If it fails to improve over the coming year, it risks being added to an FATF “grey list” along with countries such as Pakistan, Mongolia and Yemen.

Turkey was so unhappy with the report that it lobbied fellow members of the intergovernmental body to block it prior to publication, according to two people familiar with the matter.

Turkey’s strategic location, bordering Syria, Iraq and Iran as well as the EU, makes it vulnerable to criminal activities, including drug smuggling, human trafficking and terrorism.

While the report says Turkey “has understood the risks it faces from money laundering and terrorist financing,” it finds “serious shortcomings in the country’s framework to combat these crimes.” 

In a list of 11 effectiveness measures, the country is deemed to need “major” or “fundamental” improvements in nine. 

The report acknowledges that Turkey has pursued a range of terror suspects in the courts. But it says specific charges related to terrorist financing and money laundering are often given low priority by prosecutors, who tend to focus on other, more serious charges. It says the practice creates a missed opportunity to “discover financiers and go deeper to understand the broader network and support system” of international terrorist groups.

It also lists multiple concerns that Turkey has failed to implement, or been slow to enforce, UN sanctions designations aimed at stymying Iran, North Korea and the Taliban.

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