Cyprus' Central Bank at the forefront
against money laundering

May 3, 1999

Cyprus's Chief Negotiator in European Union accession talks , Mr. George Vassiliou and the country's Central Bank Governor, Mr. Afxentis Afxentiou addressing a seminar on money laundering organized by "HSBC Investment Bank Cyprus Ltd" held in Nicosia on 29 April, have both praised the Republic's performance in fighting money laundering.

Mr. Vassiliou in his statement said that Cyprus "was not, is not and will never be a money laundering centre," despite an organized effort to discredit Cyprus. Mr. Vassiliou said that the island has a large number of offshore companies simply because it is attractive to them and not because of a less vigorous legislation on money laundering. Referring to Cyprus' performance against money laundering, he said EU officials involved in the screening process relating to the Shengen Agreement last month "were really impressed with our whole system, operations, controls and knowledge of the subject."

On his part the Central bank Governor Mr. Afxentiou said Cyprus' Central Bank "has been at the forefront of the battle against money laundering and has been active in setting guidelines designed to prevent the use of our financial system by criminals." He pointed out that it was not an exaggeration to state that Cyprus could be a model for many countries in the fight against money laundering. Mr. Afxentiou added that Cyprus has ratified the UN and the Council of Europe Conventions on Money Laundering and have complied fully with the EU directives.

Furthermore Mr. Afxentiou stressed that as from 1996 " Cyprus has a very modern legislation which has enabled us to enhance even further our guidance notes and our vigorous policy against money laundering."

The Central Bank Governor referred to a Financial Action Task Force (FATF) mission in 1997, noting that as a result, Cyprus "was declassified as a priority country in the FATF External Relations program." In addition, he added, a report on money laundering adopted by the Council of Europe in June 1998, "was speaking in enthusiastic and laudatory terms about Cyprus' achievements" in fighting money laundering.

In addition, the International Narcotics Control Strategy Report of the US State Department issued on February 26 also lauds Cyprus's efforts against money laundering, adding that the Government has taken important measures in this area including strengthening and enforcing of the relevant laws. Also a report by the International Narcotic Control Board issued on February 23 took note of the action taken by the Government against money laundering.

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