Why MI5 will be watching

The wolf in sheeps clothing is a fitting emblem of a hypocrite. Every virtuous man would rather meet an open foe than a pretended friend who is a traitor at heart.
H F Kletzing

February 13, 2007
Michael Evans: Analysis

Why MI5 will be watching

Instant cash transfers by mobile phone will present another challenge for the intelligence and law enforcement agencies that have to try to keep track of money-laundering methods used by terrorists and organised crime syndicates.

MI5 is one of the agencies that attempts to penetrate the money-transfer systems used by terrorist groups to fund attacks around the world. Like the police, MI5 will expect any new money-transfer systems to be guarded by strict checks under which financial reporting officers of banking and other institutions are obliged by law to make known any suspicious activities.

The Vodafone tie-up with Citigroup, offering a mobile-based international money-transfer service, will be closely monitored to ensure that it provides the required safeguards. “We look at all possible avenues for money-laundering,” a source in the Serious Organised Crime Agency (Soca) said.

Under the Proceeds of Crime Act 2002, any banking institution that uncovers potential money-laundering transfers is supposed to fill in a “suspicious activity report” and send it to Soca.

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Generally, a suspicious transfer would involve a cash transaction of about £10,000 or more, although some banks intervene at a lower level. However, in the counter-terrorist world, this cash threshold is not so relevant because, as illustrated by some of the more recent terror attacks, the funds required are surprisingly low. The July 7 suicide bombings in London cost the terrorists about £7,000.

For the counter-terrorist watchers, this means that monitoring of relatively small cash transfers to fund a terrorist attack is a more challenging exercise. Terrorist groups use a range of methods to deliver cash for the purchase of bomb materials or to set up logistics arrangements, including leasing safe houses and storage facilities.

Mobile phone-based transfers might offer another outlet for the terrorist, which is why organisations such as MI5 and Soca will be keeping a watching brief on this latest offer of international cash transfers.

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Clare Swinney

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