Turkey Loopholes on Terror Finance Risk OECD Blacklist
Turkey has failed to tighten laws blocking financing of terrorist groups, and risks being put on a list of non-complying countries that includes Iran and North Korea, said academics and analysts from Istanbul to Washington.
The Financial Action Task Force sponsored by the Organization for Economic Cooperation and Development warned in June it would “call upon its members to apply countermeasures” against Turkey if rules weren’t tightened by October. Kenya and Myanmar are the other two countries at risk of joining the blacklist. The group meets in Paris today to address the issue.
OECD concerns include inadequate monitoring of bank transfers and unwillingness to freeze accounts. A terror financing bill drafted to address them is still held up in Turkey’s parliament. While the NATO member and European Union candidate isn’t likely to be assigned pariah status, a downgrading by the Task Force could impede transactions with Western banks.
That would be “damaging to all aspects of the Turkish economy including tourism, manufacturing and finance,” said Jack Smith, an anti-money laundering specialist and adjunct professor at the George Washington University Law School.