The challenges of establishing a sustainable system for isolating those who misuse informal funds transfer (IFT) systems, such as Hawala, has been the main theme of the conference on Hawala, organized by the Central Bank of the UAE.The conference, which is being held in Abu Dhabi from 18-20 March, heard from regulators, academic specialists, law enforcement officers and financial institutions, who related their experiences in dealing with the various elements of IFT systems and debated the potential solutions.More than 300 local and international representatives from many countries attended the event, which is fourth on Hawala to be organized by the Central Bank. These conferences have been instrumental in increasing understanding of IFT systems and led the debate on the best way to bring them into the regulatory system.There was broad agreement that the goal should be to establish a system of regulation that encouraged the informal system to provide regulators with more information while ensuring that law enforcement agencies were able to act against those who used it to finance money laundering and other criminal activities.At the start of the conference, His Excellency Sultan Bin Nasser Al Suwaidi, Governor of the Central Bank of the UAE, said that more regulations should be devised and introduced to isolate further those who misused the Hawala system. Representatives also heard from some regulators who stressed the importance of having a system which monitored the activities of those, including Hawaladars, involved in the informal transfer of funds.However, some other regulators and law enforcement agencies said that tighter regulations made it easier to track down those who were misusing the system for money laundering, terrorist finance and other illegal activities.Academics and those involved in providing development support for poorer economies provided detailed research into the way IFT systems operated, showing the importance of effective, affordable remittance systems to the world's poorest economies. And private financial institutions showed how they were trying to offer new types of money transfer that could compete with informal systems on cost, speed and exchange rates. Source WAM
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