Tax evasion tops money crimes

August 28, 2009 04:26:06 PM

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Fiji’s money laundering landscape is rife with cases of tax evasion and it tops the list of financial crimes committed in the country, said Razim Buksh, director of Fiji’s Financial Intelligence Unit. 

He revealed this to Fiji Live as the unit released this week its 2008 annual report, which details work that is being done to combat money laundering and terrorist financing in Fiji. 

“Tax evasion remains of top and then the use of fake or fraudulent financial instruments. These fake credit cards, forged cheques and even fake travelers cheques are presented to financial institutions by both locals and foreign nationals,” Buksh said. 

“The FIU received 479 ‘suspicious transaction’ reports from banks as well as from non-bank financial institution from all across Fiji. The FIU disseminated over 200 intelligence reports to relevant law enforcement authorities, most of that to FIRCA for suspected tax evasion cases and to the Fiji Police Force for suspected money laundering and proceeds of crime cases,” he added.

Financial institutions in Fiji are required to report all suspicious funds and transactions including attempted transactions to the FIU by completing the Suspicious Transaction Report (STR) form. This is required under section 14 of the FTR Act and section 24 of the FTR Regulations.

A “suspicious transaction” is a transaction or attempted transaction which a financial institution has reasonable grounds to suspect may be related to a money laundering activity, or any other serious offence, according to the FIU 2008 annual report.

Buksh said the 479 suspicious transactions received by FIU were valued at $19.2 million but cautioned this must not be taken to reflect the size of money laundering activities happening in Fiji as some STRs were later verified as legitimate transactions.

But while tax evasion continued to be a problem for Fiji, Buksh confirmed other new emerging crimes were also gaining prominence.

“Fiji’s real estate sector is vulnerable to money laundering activities and deceptive land or property dealings involving locals and foreigners. Identification fraud or theft is also being used by adversely reported individuals in the commission of other serious offences such as forgery. Fake identification documents reported to the FIU include passports, birth certificates and drivers licenses,” he said.

The FIU recorded 268 STRs in 2007 valued at $26.3 million, while in 2006, it received 215 STRs valued at $65 million.

Buksh said the unit has gradually strengthened its effort to combat money laundering and terrorist financing in the country.

“Fiji now has a comprehensive and strong anti-money laundering framework that has worked well in the past years.

“The introduction of newer requirements in 2008 such as the $10,000 cash transaction reporting, the $10,000 border currency reporting and the international funds transfer reporting has further strengthened our efforts.

“We continue to take additional measures such as the FIU joining the Egmont Group of International FIUs this year. FIU’s intelligence and reports are being increasingly used by law enforcement agencies in Fiji to assist them in investigating and prosecuting serious and organized crimes,” he said.