A ‘Snapshot’ of the G8 Initiatives on International Financial Crime
| Published date | 01 January 1999 |
| Date | 01 January 1999 |
| Pages | 267-269 |
| DOI | https://doi.org/10.1108/eb025894 |
| Author | Shazeeda Ali |
| Subject Matter | Accounting & finance |
Journal of Financial Crime — Vol. 6 No. 3 — Financial Crime
FINANCIAL CRIME
A 'Snapshot' of the G8 Initiatives on International
Financial Crime
Shazeeda Ali
International financial crime is without doubt one
of the major challenges facing the world today. Its
elimination remains a priority of world leaders and
in 1998 when representatives of the G81 assembled
to discuss possible solutions to critical global
issues, tackling international financial crime was at
the top of their agenda.2
Financial crime has come to assume inter-
national proportions in light of the concurrent glo-
balisation of financial services and crime. It is the
consequent prospect of international financial
crime creating havoc in the world economy,
through its complete destabilisation of the global
financial system, that has prompted increased
action against this threat.
PROTECTING THE GLOBAL FINANCIAL
SYSTEM
The BCCI and Barings banking disasters and the
recent Asian financial crisis have exposed the need
to bolster 'the architecture of the global financial
system' in order to reduce its potential weaknesses
and vulnerabilities. In fact, these incidents were
cited as examples highlighting the urgency of rein-
forcing transparency, good governance and sound
economic policies. Such measures are necessary to
prevent further abuse and to enhance not only the
functioning of financial markets but also the
quality of economic policy making and the con-
fidence of the investing public.3
It is within this context that the G8 has identi-
fied the need for action in the following areas:4
(i) strengthening national financial systems;
(ii) enhancing transparency and data dissemina-
tion;
(iii) helping countries to prepare for integration
into the global economy and for free capital
flows;
(iv) ensuring that the private sector takes respon-
sibility for its lending decisions; and
(v) improving cooperation amongst international
financial institutions and regulators.
INTERNATIONAL COOPERATION
Globalisation, and its attendant benefits and risks,
renders countries ever more interdependent.
'Cooperation is key' has become a familiar refrain
and, not surprisingly, this mantra forms the main
thrust of the G8's present initiatives.
Leaders recognise more and more that since
criminals work together to commit international
crimes, governments must also work together to
successfully defeat them. Indeed in a similar vein,
and on the heels of the G8 conference, the inter-
national community has recently resolved to
achieve greater multilateral cooperation in the
sphere of drug control.5
International cooperation between financial reg-
ulators and law enforcement authorities is particu-
larly required since existing systems for the
exchange of information 'are not as quick and effi-
cient as they need to be.'6 In terms of improving
the flow of information among financial super-
visors, the group's Finance Ministers have com-
mended ten key principles for information
exchange which include the following:7
— sharing supervisory information with foreign
supervisors;
— the sharing of information by supervisors from
different sectors of financial services;
— the sharing of objective information of super-
visory interest about individuals such as
owners, shareholders, directors, managers or
employees of supervised firms;
— confidentiality of shared information;
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