Speech by Terry Davis, Secretary General of the Council of Europe

MONEYVAL 10th anniversary plenary meeting

Strasbourg, 3 December 2007

The Council of Europe has been active in the fight against money-laundering for a very long time - long before MONEYVAL was established in 1997. In fact, in 1980, the Council of Europe was the first international organisation to issue a public warning about the dangers of dirty money in financial systems. Since then we have worked to fight money laundering through standard-setting, monitoring compliance and technical assistance.

Why is the fight against money laundering so important? The answer is very simple. Most of the laundered money comes from organised crime. It provides organised crime with cash flow, investment capital and an incentive to commit more crimes. Jeffrey Robinson, in his book, “The Laundrymen” maintains that:

“If you walk one mile in any direction from the main central railway station in any major city in Europe or North America you will pass within an elbow’s distance of a property that is owned by, managed by, or has been constructed by dirty money”.

I have not tested this theory in London, Paris or Strasbourg, but you get the point: organised crime and money laundering go hand-in-hand. The fight against money laundering is part of the fight against organised crime, which threatens the security of all our citizens. After the events of September 11th 2001, our Committee of Ministers took rapid action to extend the mandate of MONEYVAL to include the financing of terrorism.

In 1997 the Committee of Ministers had set up a new Committee, known then as PC-R-EV. At the Council of Europe and, I suppose, in other international bodies, we have an irritating habit of creating acronyms which are impossible to pronounce and sometimes impossible to remember. It must have come as a great relief to everyone (except perhaps money launderers), when PC-R-EV was eventually renamed MONEYVAL.

The predecessor of MONEYVAL was created to follow the practices and procedures of the Financial Action Task Force or FATF and to evaluate those Council of Europe members that were not members of FATF. This was very important at the time of the accession of many Central and Eastern European countries to the Council of Europe in the 1990s.

I should like to thank all those many countries which have made voluntary contributions to PC-R-EV and MONEYVAL during the last 10 years. I should particularly like to thank the governments of the United Kingdom and the United States, who have regularly provided financial support for the work of this Committee. Although the Council of Europe now meets most of MONEYVAL’s expenditure from our ordinary budget, voluntary contributions continue to enable the Committee to take on important additional projects.

From its original membership of 21 countries in 1997, MONEYVAL has expanded so that 29 countries now submit themselves to its evaluation processes. So far it has adopted 63 detailed assessment reports, 54 progress reports and worked closely with member states on the follow-up to those reports. Where necessary, the Committee has applied peer pressure through its Compliance Enhancing Procedures to ensure that international standards are met.

Perhaps I should also mention that MONEYVAL is not a typical institution because it works within the institutional framework of an established international organisation. This is an asset. Its follow-up procedures, conducted under the authority of the Council of Europe, mean we are able to take effective action to ensure that standards are met.

And the process works: conventions are being ratified; laws and procedures which match international standards are being put into place; financial intelligence units are being created where none existed to analyse suspicious activity reports from banks and other relevant institutions.

Ever since the creation of MONEYVAL, emphasis has been put not only on formal compliance with international standards, but also on effective implementation. Any country can pass laws. Enforcing them effectively requires political will and the provision of necessary resources and training to ensure that the standards, embodied in those laws, are implemented in practice.

To put it simply, MONEYVAL is good value for money.