Canadian anti-money laundering group considers transferring some staff to Qatar

The Egmont Group, an organization made up of the world’s financial intelligence agencies, is considering moving staff supporting its anti-money laundering training school from Ottawa to Qatar, according to two sources.

According to sources familiar with the discussions, the move will not affect the entire secretariat in Canada, but it will affect employees who support the Egmont Centre of FIU Excellence and Leadership (also known as ECOFEL).

The Globe and Mail is not naming its sources because they are not authorized to speak publicly on the matter.

The possible move to Qatar raises concerns about the establishment of a major anti-money laundering training organisation in a country plagued by high-profile cases of financial crime.

According to a FATF investigation, the Financial Action Task Force, an intergovernmental body, has called on the Gulf state to step up its fight against money laundering and terrorist financing. Until late last year, Qatar was on the European Union’s “grey list” of non-cooperative tax jurisdictions.

Earlier this year, Qatar’s former finance minister was sentenced to 20 years in prison for laundering more than $5.6 billion. A director of Qatar’s Public Works Authority was recently accused of accepting bribes, according to The Peninsula, an English-language newspaper in Qatar.

Qatar has also provided financial support to Hamas, according to some news reports. The Canadian government considers Hamas a terrorist group.

The Egmont Group said in a statement that it is “unable to comment on internal matters.”

“In support of its important mission and in line with its fundamental Charter, the Egmont Group regularly considers financial (or in-kind) contributions from members and other public organizations. Decisions within the Egmont Group are always made by consensus among its 177 members, with equal treatment as a fundamental principle,” the statement provided to The Globe said.

The Qatar Financial Information Unit did not respond to a request for comment.

It is unclear why the Egmont Group is considering relocating ECOFEL, although some experts have suggested that Qatar may be offering financial incentives.

Jim Richards, a leading anti-money laundering consultant, said he “can think of no technical or professional reason why Qatar would be a logical home for the Egmont Group’s ECOFEL.”

“If it was just because Qatar was the main or a major funder of ECOFEL, then I would wonder whether it was a ‘pay to play’ situation where Qatar was trying to curry favour with the other 169 financial intelligence agencies,” Mr Richards said.

Stephen Rae, publisher of AML Intelligence magazine, said he would like Egmont Group to explain the rationale for such a move, including how much money is being offered and whether there are any conditions attached.

“Egmont and ECOFEL play a crucial role in the fight against financial and economic crime around the world. They represent the best of law enforcement. As role models, it is important not only that they do the right thing, but that they do the right thing – and transparency is key. Be upfront, say whether there is a deal or not; and if there is a deal with Doha, what is in the small print?” Mr Rae said.

The Egmont Group, which consists of 177 FIUs worldwide, provides a platform for the international sharing of financial information in the fight against money laundering and terrorist financing.

The group has grown significantly since its founding in 1995. The group takes its name from the Egmont Palace in Brussels, where its founding meeting was held. In 2008, the Egmont Group opened a secretariat in Toronto with a commitment from the Canadian federal government of $5 million over five years.

Then-Finance Minister Jim Flaherty said at the time that giving the Egmont Group a permanent home would help support its work to stop money laundering and “deprive criminals of the funds they need to finance their destructive aims: drug trafficking, organised crime and terrorist activities.”

Around 2012-2013, the office moved from the intersection of Bloor and Church Streets to a more northerly part of the city, near Yonge Street and Eglinton Avenue, for financial reasons. It was relocated again in 2019, to Ottawa, “after careful consideration of various business factors,” according to a statement from the Egmont Group.

The Egmont Group employs around 30 people, a handful of whom are dedicated to ECOFEL. The school was funded in 2018 with seed funding from the UK Foreign, Commonwealth and Development Office.

While the group’s work is paid for by the fees of its member FIUs, ECOFEL is funded exclusively by donations. Donors include FIUs in Saudi Arabia and Australia, the governments of Monaco and the Grand Duchy of Luxembourg. Donations are approved by group heads of the member FIUs and “equal treatment is a core principle of Egmont,” the group said.

ECOFEL training events are held in various locations around the world. For example, a workshop on improving inter-agency cooperation was held in Seychelles last October, while a course on financial investigation techniques was held in Uzbekistan.

The Egmont Group statement said that venues will be chosen based on regional needs and the availability of its partners. “Host countries may provide funding or donations to support the events,” the statement said.

The Egmont Group has recently faced calls for greater transparency around its finances, including from Ilze Znotina, former head of the Latvian FIU.

Ms Znotina told AML Intelligence earlier this year that she would like to see the Egmont Group publish financial information, such as its budget, on its website. Her comments came after the group announced it had received a “substantial donation” from the United Arab Emirates, a country that was at the time on the Financial Action Task Force’s grey list.

Countries on the intergovernmental body’s grey list are countries that have been found to fall short in managing risks related to money laundering and terrorist financing. The UAE has since been removed from the grey list after complying with a sufficient number of FATF recommendations.

Mr Richards agreed with Ms Znotina’s comments about the need for greater transparency within the Group.

“I haven’t seen anything that looks like financial disclosures, whether it’s which FIUs are contributing how much money, or how many people, or how much technology. And there’s nothing on the expenditure side either. What are they spending the money on?” Mr. Richards said.

Mr Rae said that while criminal gangs, drug cartels and oligarchs have gained access to greater amounts of cash and cryptocurrencies, law enforcement agencies worldwide are facing budget freezes and challenges in recruiting and retaining staff.

“You see FIUs awash with information but starved of resources, in some cases frozen by data overload,” Mr Rae said. “Therefore, offers of money, resources should be welcomed to get the technology and people to help, but there needs to be transparency about where the funds are coming from.”

Mr Rae said the Egmont Group needed access to more sustainable financing, which would remove the need for one-off deals.