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Monday, 12 November, 2001, 00:06 GMT
Law boosts terror cash crackdown
Briefcase full of dollars
The money laundering regulations went through Parliament on Friday
New powers aimed at stopping terrorists from using bureaux de change for money laundering will come into force on Monday.

Ministers believe groups like the al-Qaeda network have been using bureaux de change to launder funds obtained through the drugs trade.

It is estimated that more than 2bn a year changes hands in this way.

The new money laundering regulations will give HM Customs powers of inspection and regulation of bureaux de change, cheque cashing companies and money transmission agents.

Our aim is clear - to cut off the funds terrorists and criminals rely on to pay for their operation

Paul Boateng, Customs Minister
The move is part of the government's response to the 11 September attacks in the United States.

It is being launched as the government moves to introduce emergency measures to detain terrorist suspects without trial.

Legislation to crack down on bureaux de change went quietly through Parliament on Friday.

At present, anyone can set up a bureau de change but under the new regulations all such offices will have to be registered and approved by Customs and Excise.

Customs staff will also be given the power to carry out surprise inspections at money changing offices to examine their accounts.

Customs Minister Paul Boateng said: "Our aim is clear - to cut off the funds terrorists and criminals rely on to pay for their operations.

Frozen assets

"These new arrangements give Customs the powers they need to inspect businesses and stop them being used to launder the proceeds of drug trafficking and other criminal activity."

The UK-wide powers include:

  • entry to and inspection of premises
  • inspection of information and currency
  • the power to seize evidence where criminal activities are suspected.

    Failure to comply with registration requirements, or to provide access to premises and records, could result in a fine of up to 5,000.

    Government officials say that since 11 September, six bureaux de change have been raided and 16 people arrested for allegedly laundering a total of 120m.

    Last month, the government announced new measures to freeze assets they suspected were being used by terrorist organisations, following the US attacks.

    The move is part of an international drive to paralyse funding for alleged terrorist organisations.

    Treasury officials have disclosed that 70m has now been frozen in 38 different bank accounts in Britain believed to belong to terrorists.

    The BBC's Margaret Gilmore
    "Criminals and terrorists use bureauxs to channel illicit cash"
    See also:

    12 Oct 01 | Business
    UK expands freeze on terror funds
    12 Nov 01 | UK Politics
    Blunkett seeks terror laws approval
    10 Oct 01 | Business
    UK is 'money launderers' paradise'
    28 Sep 01 | Business
    Net closes on terror cash
    25 Sep 01 | UK Politics
    UK backs terror cash clampdown
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