9 May 2012
For some Europeans, yesterday’s big event was the 67th anniversary of the end of War in Europe. It also marks the launch of the 2012 Basel Anti Money Laundering Index. This is a composite ranking that analyses countries’ risk regarding money laundering, terrorism financing, and related factors such as corruption and political risk.
New Zealand is rated as the 6th least at risk of the 140 assessed . Although not one of the two “low risk” countries – these are Norway and Estonia – New Zealand is in an adjacent group, following Slovenia, Sweden and Finland. Australia is ranked 18th least risky – despite the shift to surplus in last night’s Budget being ahead of all other OECD countries.
The three most risky countries are Iran, Kenyan and Cambodia.
Scores making up the AML Index are a combination of indicators structured around anti-money laundering, counter-terrorist financing laws, financial regulations, political disclosure and related factors dealing with corruption and financial risks. The Index enables proper country risk assessment, accessible to all financial institutions, that provides a consistency not previously available. To date there has been no universally agreed definition by either governments or institutions that prescribes whether a particular country represents a higher risk.
The developers believe that the independent and academic character of the compilation, aggregating data from recognised source agencies including the World Bank, FATF, World Economic Forum, and Transparency International will ensure that the Basel AML Index will be accepted as the worldwide standard.
New Zealand’s low risk ranking on this Basel AML Index Index conflicts with harsh criticism made last year when Nicholas Shaxson auggested that New Zealand was institutionalising tax evasion. He predicted that before long, it would be counted among the rogues, with a black record on the Financial Secrecy Index.