Open this photo in gallery: A man takes a picture of a child on Doha's seaside promenade with the Qatari capital's skyline in the background on Aug. 6. The Egmont Group is mulling a relocation of ECOFEL to Qatar, which has some experts suggesting that the country may be offering financial incentives.KARIM JAAFAR/GETTY IMAGES
The Egmont Group, a body made up of the world’s financial intelligence units, is considering relocating staff that support its anti-money-laundering training school from Ottawa to Qatar, according to two sources.
The move would not affect the entire Canadian-headquartered secretariat but, rather, those employees who support the Egmont Centre of FIU Excellence and Leadership, which is known as ECOFEL, according to the sources, who are familiar with the discussions.
The Globe and Mail is not identifying the sources because they are not authorized to speak publicly about the matter.
The possible move to Qatar raises concerns about locating an important anti-money-laundering training organization to a country that has struggled with high-profile instances of financial crime.
Financial Action Task Force, an intergovernmental body, has urged the Gulf state to step up its fight against money laundering and terrorism financing, according to an FATF review, and until late last year Qatar was on the European Union’s “grey list” of non-co-operative tax jurisdictions.
Earlier this year, Qatar’s former finance minister was sentenced to 20 years in prison for laundering more than US$5.6-billion. A director at Qatar’s Public Works Authority was recently accused of accepting bribes according to The Peninsula, an English-language daily 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 foundational Charter, the Egmont Group considers financial (or in kind) contributions offers from members and other governmental organizations regularly. The decisions within the Egmont Group are always made by consensus among its 177 members, with equal treatment being a fundamental principle,” read the statement provided to The Globe.
The Qatar Financial Information Unit did not respond to a request for comment.
It’s unclear why the Egmont Group is mulling a relocation of ECOFEL, although some experts suggested that Qatar may be offering financial incentives.
Jim Richards, a prominent anti-money-laundering consultant, said he “can’t think of a technical or professional reason why Qatar would be a logical home for the Egmont Group’s ECOFEL.”
“If it was simply because Qatar was the main or a significant funder of ECOFEL, I would then wonder whether it was a ‘pay to play’ situation where Qatar was currying favour with the other 169 financial intelligence units,” Mr. Richards said.
Stephen Rae, publisher of the journal AML Intelligence, said he would like the Egmont Group to provide the rationale for such a move, including how much money is being offered and whether there are any conditions attached.
“Egmont and ECOFEL play vital roles in combating financial and economic crime across the globe. They represent what is best about law enforcement. As role models it is important not only that they do the right thing but are seen to do the right thing – and transparency is at the very heart of this. Be upfront, say if there is a deal or not; and if there is a deal in process with Doha, what’s in the fine print?” Mr. Rae said.
The Egmont Group, which comprises 177 FIUs around the globe, provides a platform for sharing financial information internationally in the fight against money laundering and terrorist financing.
The group has grown significantly since its inception 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 Canadian federal government commitment 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 halt money laundering and “starve criminals of the funds necessary to finance their destructive aims: drug trafficking, organized crime and terrorist activity.”
Around 2012-2013, the office moved from the intersection of Bloor and Church Streets to a more northern part of the city, near Yonge Street and Eglinton Avenue, for financial reasons. It was relocated again, to Ottawa, in 2019, “after careful consideration of several business factors,” according to a statement from the Egmont Group.
Roughly 30 people work at the Egmont Group, with a handful of them dedicated to ECOFEL. The school was funded in 2018 with seed financing from the United Kingdom’s Foreign, Commonwealth and Development Office.
While the work done by the group is paid for by fees from the member FIUs, ECOFEL is funded solely by donations. Donors have included FIUs in Saudi Arabia and Australia, the government of Monaco and the Grand Duchy of Luxembourg. Donations are approved by group heads of the member FIUs and “equal treatment is a core Egmont rule,” according to the group.
ECOFEL’s training events are held in various locations around the world. For instance, a workshop on improving interagency co-operation was held in Seychelles last October, while a course on financial investigative techniques took place in Uzbekistan.
The statement from the Egmont Group said that locations are chosen based on regional needs and the availability of its partners. “Host countries may provide financing or donations to support the events,” the statement said.
The Egmont Group recently faced calls for greater transparency around its financials, including from Ilze Znotina, the former head of Latvia’s FIU.
Ms. Znotina told AML Intelligence earlier this year that she would like to see the Egmont Group disclose financial information, such as its budget, on its website. Her comments came after the group disclosed that it had received a “substantial donation” from the United Arab Emirates, a country that at the time was on the Financial Action Task Force’s grey list.
Countries on the intergovernmental body’s grey list are those that have been found to be deficient in managing risks relating to money laundering and terrorism financing. The UAE has since been removed from the grey list after satisfying a sufficient number of the FATF’s recommendations.
Mr. Richards agreed with Ms. Znotina’s comments about the need for greater transparency by the group.
“I haven’t seen anything resembling financial disclosures, whether it is which FIUs are contributing how much cash, or how many people, or how much technology. And there’s nothing on the expense 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 larger quantities of cash and cryptocurrency, law enforcement agencies worldwide are facing budget freezes and challenges recruiting and retaining staff.
“You are seeing FIUs swamped with information but starved of resources, in some cases frozen under data overload,” Mr. Rae said. “That’s why offers of money, resources are to be welcomed to get the technology and people to help, but there must be transparency about where the funds emanate.”
Mr. Rae said that the Egmont Group needs access to more sustainable financing, which would eliminate the need for one-off deals.