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Monday, 23 October, 2000, 12:44 GMT
Clampdown on money laundering
Graphic depicting money laundering process
Some of the world's largest banks have agreed a code to crack down on money laundering, Swiss bank UBS said.

The guidelines apply to private banking, where banks cater to wealthy individuals.

It is estimated that every year $600bn in illegal money passes through banks in major financial centres around the world.

The bank code follows threats of tough action from the members of the G7 club against countries which permit money laundering on their territory.

Details of the guidelines are expected to be unveiled on 30 October.

Anti-corruption pressure group Transparency International helped draw up the guidelines, which aim to ensure global standards of due diligence to prevent criminal proceeds from flowing into the finanical system, the Swiss bank said.

The banks involved are UBS, Barclays, Citigroup, Deutsche Bank, HSBC, JP Morgan, Chase Manhattan, Societe Generale, Bankers Trust, Banco Santander and Credit Suisse.

Sanctions threat

The code follows repeated calls for offshore havens to clean up their act.

After meeting in Japan earlier this year, G7 finance ministers warned that states which fail to join international efforts to combat such transactions could face sanctions.

US treasury secretary Larry Summers has said: "Money laundering may look like a polite form of white collar crime, but it is the companion of brutality, deceit and corruption."

While money laundering has known many incarnations, liberalised markets and exchange control deregulation are thought to have made it easier.

The two have conspired to open up more channels for laundering dirty money and more opportunities to hide the source of funds.

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See also:

20 Jul 00 | Business
Liechtenstein banking crackdown
08 Jul 00 | Business
G7 warns dirty money states
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