Building infrastructure to combat money laundering is essential for Ukraine’s victory and future reconstruction. Why is this question so fundamental?
Financial issues of Ukraine’s recovery, mechanisms for preventing money laundering, as well as ensuring transparency were discussed recently by Tom Keatinge, director of the Centre for Financial Crime and Security Studies of the Royal United Services Institute for Defence and Security Studies, and Oleksii Dorogan, executive director of the BRDO. Here are some of the takeaways of their conversation:
🔹 When large-scale investment in reconstruction begins, there will be calls to ensure that the country’s financial system effectively prevents illegal activities. The state should prepare for this right now so that when the time comes, Ukraine can say: we have an effective financial monitoring system, and funds cannot be stolen and diverted through the banking system to invest, for example, in property in London or real estate in Miami.
🔹 There is a lot of resistance to change in the world of financial crime. In general, when progress is made, it is slow, whether in banking or the government sector. These are usually step changes. In the case of Ukraine, there is an opportunity for change from day one to create an entirely new system that the rest of the world could learn from.
🔹 Providing banks with access to all the information they need to decide on suspicious transactions is one of the fundamental guarantees of the transparency of the financial system. Once the money leaves the country, it is almost impossible to get it back. Therefore, securing that first stage, when laundered money goes to a local bank and then out of the country, is critically important.
🔹 Strengthening the fight against money laundering in Ukraine and worldwide will make it more difficult for Russia to wage war. Also, the fight against money laundering in Ukraine will increase the confidence of governments ready to allocate funds for reconstruction so that this money will not be stolen. We are talking about hundreds of billions of dollars.
Listen to the full conversation of the experts here: in Ukrainian and in English
The podcast was created as part of the project “Supervising and Monitoring Ukraine’s Reconstruction Funds” of the Centre for Financial Crime and Security Studies (CFCS) at the Royal United Services Institute for Defense and Security Studies and the Better Regulation Delivery Office (BRDO).