Wolfsberg Statement on the Suppression of the Financing of Terrorism.

Business & News Editors

ZURICH--(BUSINESS WIRE)--Jan. 28, 2002

In support of efforts to suppress the financing of terrorism the Wolfsberg Group of international financial institutions (the "Wolfsberg Group") together with Transparency International held a meeting at Wolfsberg from January 9-11, 2002 to develop the initiative outlined in the enclosed statement.

The meeting was well attended by key regulators of the financial industry, representatives of national law enforcement and judicial agencies and international organizations who contributed to the discussions and welcomed the initiative taken by the Wolfsberg Group.

The fight against terrorism presents new challenges as funds used in the financing of terrorism do not necessarily derive from criminal activity, which is a requisite element of most existing money laundering offences. Successful participation in this fight by the financial sector requires global cooperation by governments with the financial institutions to an unprecedented degree.

The provision of official lists of suspected terrorists and terrorist organizations on a globally coordinated basis by the relevant competent authority in each jurisdiction providing appropriate details and information has been identified as a crucial element.

The purpose of the Statement is to describe the role that financial institutions can play in this effort, and to identify areas for discussion with governmental agencies with a view to enhancing the contribution financial institutions are able to make.

www.wolfsberg-principles.com

Enclosure: Wolfsberg Statement on the Suppression of the Financing of Terrorism

The Suppression of the Financing of Terrorism

Wolfsberg Statement

1 Preamble

The Wolfsberg Group of financial institutions (the "Wolfsberg Group") is committed to contributing to the fight against terrorism and is making the following statement to describe the role of financial institutions in preventing the flow of terrorist funds through the world's financial system.

This fight presents new challenges. Funds used in the financing of terrorism do not necessarily derive from criminal activity, which is a requisite element of most existing money laundering offences. Successful participation in this fight by the financial sector requires global cooperation by governments with the financial institutions to an unprecedented degree.

2 Role of Financial Institutions in the Fight Against Terrorism

Financial institutions can assist governments and their agencies in the fight against terrorism. They can help this effort through prevention, detection and information sharing. They should seek to prevent terrorist organizations from accessing their financial services, assist governments in their efforts to detect suspected terrorist financing and promptly respond to governmental enquiries.

3 Rights of the Individual

The Wolfsberg Group is committed to participating in the fight against terrorism in a manner which is non-discriminatory and is respectful of the rights of individuals.

4 Know Your Customer

The Wolfsberg Group recognises that adherence to existing "Know Your Customer" policies and procedures is important to the fight against terrorism. Specifically the proper identification of customers by financial institutions can improve the efficacy of searches against lists of known or suspected terrorists issued by competent authorities having jurisdiction over the relevant financial institution ("applicable lists").

In addition to the continued application of existing customer identification, acceptance and due diligence procedures, the Wolfsberg Group is committed to:

-- Implementing procedures for consulting applicable lists and taking
reasonable and practicable steps to determine whether a person involved in a
prospective or existing business relationship appears on such a list.

-- Reporting to the relevant authorities matches from lists of known or
suspected terrorists or terrorist organisations consistent with applicable laws
and regulations regarding the disclosure of customer information.

-- Exploring with governmental agencies ways of improving information exchange
within and between jurisdictions.

-- Exploring ways of improving the maintenance of customer information to
facilitate the timely retrieval of such information.

5 High Risk Sectors and Activities

The Wolfsberg Group is committed to applying enhanced and appropriate due diligence in relation to those of their customers engaged in sectors and activities which have been identified by competent authorities as being widely used for the financing of terrorism, such as underground banking businesses or alternative remittance systems. This will include the adoption, to the extent not already in place, of specific policies and procedures on acceptance of business from customers engaged in such sectors or activities, and increased monitoring of activity of customers who meet the relevant acceptance criteria.

In particular the Wolfsberg Group is committed to restricting their business relationships with remittance businesses, exchange houses, casas de cambio, bureaux de change and money transfer agents to those which are subject to appropriate regulation aimed at preventing such activities and businesses from being used as a conduit to launder the proceeds of crime and/or finance terrorism.

The Wolfsberg Group recognises that many jurisdictions are currently in the process of developing and implementing regulations with regard to these businesses and that appropriate time needs to be given for these regulations to take effect.

6 Monitoring

Recognising the difficulties inherent in identifying financial transactions linked to the financing of terrorism (many of which appear routine in relation to information known at the time) the Wolfsberg Group is committed to the continued application of existing monitoring procedures for identifying unusual or suspicious transactions. The Wolfsberg Group recognises that while the motive for such transactions may be unclear, monitoring and then identifying and reporting unusual or suspicious transactions may assist government agencies by linking seemingly unrelated activity to the financing of terrorism. In addition, the Wolfsberg Group is committed to:

-- Exercising heightened scrutiny in respect of customers engaged

in sectors identified by competent authorities as being widely

used for the financing of terrorism.

-- Monitoring account and transactional activity (to the extent

meaningful information is available to financial institutions)

against lists generated by competent authorities of known or

suspected terrorists or terrorist organisations.

-- Working with governments and agencies in order to recognise

patterns and trends identified as related to the financing of

terrorism.

-- Considering the modification of existing monitoring procedures

as necessary to assist in the identification of such patterns

and trends.

7 Need for Enhanced Global Co-operation

The Wolfsberg Group is committed to co-operating with and assisting law enforcement and government agencies in their efforts to combat the financing of terrorism. The Wolfsberg Group has identified the following areas for discussion with governmental agencies, with a view to enhancing the contribution financial institutions are able to make:

-- The provision of official lists of suspected terrorists and

terrorist organisations on a globally co-ordinated basis by

the relevant competent authority in each jurisdiction.

-- The inclusion of appropriate details and information in

official lists to assist financial institutions in efficient

and timely searches of their customer bases. This information

should ideally include (where known) in the case of

individuals: date of birth; place of birth; passport or

identity card number; in the case of corporations; place of

incorporation or establishment; details of principals; to the

extent possible, reason for inclusion on the list; and

geographic information, such as the location, date and time of

the transaction.

-- Providing prompt feedback to financial institutions on reports

made following circulation of such official lists.

-- The provision of meaningful information in relation to

patterns, techniques and mechanisms used in the financing of

terrorism to assist with monitoring procedures.

-- The provision of meaningful information about corporate and

other types of vehicles used to facilitate terrorist

financing.

-- The development of guidelines on appropriate levels of

heightened scrutiny in relation to sectors or activities

identified by competent authorities as being widely used for

terrorist financing.

-- The development by governments and clearing agencies of

uniform global formats for funds transfers that require

information which may assist their efforts to prevent and

detect the financing of terrorism.

-- Ensuring that national legislation:

-- Permits financial institutions to maintain information derived

from official lists within their own databases and to share

such information within their own groups.

-- Affords financial institutions protection from civil liability

for relying on such lists.

-- Permits financial institutions to report unusual or suspicious

transactions that may relate to terrorism to the relevant

authorities without breaching any duty of customer

confidentiality or privacy legislation.

-- Permits the prompt exchange of information between

governmental agencies of different nation states.

The Wolfsberg Group supports the FATF Special Recommendations on Terrorist Financing as measures conducive to the suppression of the financing of terrorism.

Media Contacts Reporters may wish to call the participating banks directly at their head offices. Several of the press relations contacts are listed below.