The International Monetary Fund (IMF) will launch a donor-supported trust fund to finance technical assistance to combat money laundering and terrorism financing, a growing menace to global financial stability, reports say.
The Multi-Donor Trust Fund, the first in a series of so-called Topical Trust Funds will be launched May 1 and povide about USD 31 million in over five years to strengthen global anti-money laundering (AML) and combating the financing of terrorism (CFT) regimes, using the Fund's proven expertise and infrastructure.
Switzerland, Norway, Japan, Saudi Arabia, Britain, Luxembourg, Korea, and France will be providing about two-thirds of the financing, the 185-member Washington-based lender announced Wednesday.
Murilo Portugal, Deputy Managing Director of the Fund said global financial stability hinges not only on the collective action at the international level, but also on effective national systems. The trust fund combines both these elements, therefore, robust AML/CFT regimes are an important pillars to strengthen the global financial framework.
Stating that financial stability and financial integrity are closely linked, he said money laundering and terrorist financing activities can undermine the soundness and stability of financial institutions and systems.
This can further discourage foreign investment, and distort international capital flows. Moreover, such problems can quickly spread to other countries in the region or in other parts of the world, he added.
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