We are indeed very pleased to note that there are also many other agencies outside the IMF and WB taking an active role, and often working jointly in an effort to achieve these common goals. We commend these efforts. Together with the establishment of a legal and institutional framework for anti money laundering and combating terrorist financing, it is equally important to raise public awareness on issues pertaining to money laundering and financing of terrorism, and introduce more effective ways of preventing such actions by sharing experiences of other countries. It is not for nothing that the phrase “prevention is better than cure” has been coined. It is therefore our fervent hope that this workshop will, in the next 5 days achieve this objective and also establish a framework for a regional dialogue to: •  2  Share the lessons of success and failure;  BIS Review 9/2007  •  Identify specific problems common to countries of the region;  •  Discuss future challenges common to participating countries particularly in the context of effective programmes already implemented to fight money laundering and terrorist financing,  •  Identify practical means of sustaining economic development and maintaining financial system stability in the face of such terrorist threats. While thanking the Commonwealth Secretariat and all those who have made this Conference possible, we also commend our new FIU for the initiatives it has taken to organize this international event, so early in its existence.
It is in this context that the Central Bank has pledged, in its policy statement, “Road Map: Monetary and Financial Sector Policies for 2007 and Beyond” that it would expand the work of Financial Intelligence and actively investigate and take actions to combat money laundering and terrorist financing. In the years 2005 and 2006 Sri Lanka made considerable headway in this regard. The main actions in this context were the enactment of three laws, namely, The Convention on the Suppression of Terrorist Financing Act, The Prevention of Money Laundering Act, and the Financial Transactions Reporting Act. The FTR Act created the institutional body of the FIU with regulatory powers and a mandate to formulate policies and guidelines to meet the Financial Action Task Force (FATF) 40 + 9 recommendations. This legislative package was the outcome of an in-depth consultation initiated by an inter-ministerial committee which engaged the stakeholders such as the banks and professional bodies. In the preparation of the legislation, the inter-ministerial committee closely liaised with the IMF in order to ensure that legislation complied with the Financial Action Task Force 40+ 9 recommendations. Even prior to the enactment of this legislation in Sri Lanka, there have been certain punitive measures in place, to discourage individuals from using the country’s financial institutions for Money Laundering and Financing of Terrorism activities. These measures were taken under the Exchange Control Act; the Customs Ordinance and the Banking Act.