As the world develops, the pace at which financial information is delivered, technology is developed and communications are exchanged have increased exponentially. This means that money may move around the world at an unprecedented speed with relative ease. Money laundering refers to the process through which illegally acquired money is processed to appear as if it were derived from a legitimate source. The methods by which these criminally-obtained funds may be laundered are numerous, but the more extensive its laundering through international financial institutions, the more difficult it is to trace its origin. The United Nations Office on Drugs and Crime (UNODC), the primary United Nations institution combatting this crime, estimates that the amount of money laundered per year is between $800 billion - $2 trillion.

 

To combat international money laundering and now, the financing of terrorism, several international law instruments were developed. In 1988, the United Nations Convention against the Illicit Traffic in Narcotic Drugs and Psychotropic Substances was the first treaty to legally address and criminalize money laundering. In 2003, the United Nations Convention against Transnational Organized Crime widened the legal framework addressing the criminalization of money laundering beyond funds illegally obtained from the drug trade to all major crimes. This is also true of the 2005 United Nations Convention against Corruption. These instruments create regulatory guidelines for financial institutions and other individuals and institutions likely to be involved in laundering money. The International Convention for the Suppression of the Financing of Terrorism also developed in that time period and it provided the framework for Member States to take steps to protect their financial institutions from being employed by those engaged in acts of terrorism. This Convention was laid down in response to United Nations Security Council Resolution 1373, which, among other requirements, imposed obligations on states to suppress acts related to the financing of terrorism.

International Law Instruments

United Nations Convention on Transnational Organized Crime (2000)

Ratified by Pakistan on January 13, 2010

 

United Nations Convention against Corruption (2003)

Ratified by Pakistan on August 31, 2007

 

International Convention for the Suppression of the Financing of Terrorism (1999)

Acceded to by Pakistan on June 17, 2009

Publications