Banks and Patten team up in battle against terrorism

By Peter Chapman

Date: 06/05/04

CHRIS Patten, the European commissioner for external relations, and member state banks have pledged to work together to make it easier for the banking sector to quickly freeze the assets of terrorists - such as the Revolutionary Armed Forces of Colombia (FARC) and Hamas ringleaders or al-Qaeda.

The move follows concern about the confusing array of people whose bank accounts the EU has decided to freeze as part of the fight against terrorism.

Banks complain that they are faced with so many lists that they may fail to spot all of the alleged terrorists.

At best, they say, this wastes time.

At worst, the confusion could allow terrorism bosses to plot an attack - using money that should not have been available.

However, European Voice has learned that the European Banking Federation, together with three other EU federations - the European Savings Banks Group, the European Association of Cooperative Banks and the European Association of Public Banks - are set to launch a single database listing the names of all the estimated 2,500 groups, citizens or even states, whose assets the EU wants frozen.

Under the system, bank staff will be able to quickly compare the names with details of existing accounts and new applications instead of having to plough through piles of paper-based lists.

Patten's team, in turn, has pledged to update the database, which will be available via the Commission's own website and can be integrated directly into banks' own systems.

Frédéric de Brouwer, head of the European Banking Federation's legal department, which led the project, unveiled the scheme to police chiefs at Lyon-based Interpol late last month.

He said a flood of embargo regulations, which require banks to freeze the assets of suspected terrorists and terrorist organizations, and sometimes governments - such as Burma and Zimbabwe - have increased dramatically after the terrorist attacks in America on 11 September 2001.

Since then, an ever-growing number of lists of persons and organizations subject to EU financial sanctions has been published, but only in the European Community's Official Journal.

Other sources, such as the United Nations, national governments and the US office of foreign assets control, have also been churning out their own lists of alleged terrorists that should not be allowed to withdraw cash they have deposited in the banking sector.

De Brouwer told this newspaper: "The lack of consolidation of embargo lists at EU level created a great deal of confusion within banks.

"The new database will allow banks to react more swiftly and efficiently concerning their obligation to freeze the assets of persons subject to EU financial sanctions, by having to check only a single database rather than a number of different lists."

He said the system is being road-tested by a handful of EU banks and will be operational at the end of May.

The European Commissioner for External Relations, Chris Patten, has pledged to work with banks in Member States to facilitate swifter freezing of terrorists' assets. The European Banking Federation, the European Savings Banks Group, the European Association of Cooperative Banks and the European Association of Public Banks are to launch a single database listing the names of all the estimated 2,500 groups, individuals or even states, whose assets the EU wants frozen. The system will be operational at the end of May 2004.

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