Mahfud MD: Financial Service Providers Must Be Able To Identify Risks Of Money Laundering And Terrorism

Coordinating Minister for Political, Legal and Security Affairs (Menko Polhukam) Mahfud MD (Photo: DOK Kemenko Polhukam)

JAKARTA - Coordinating Minister for Political, Legal and Security Affairs (Menko Polhukam) Mahfud MD reminded financial service providers (PJK) to be able to identify the risks of money laundering and terrorism.

This was conveyed by Mahfud as a keynote speaker in a Webinar entitled Opportunities, Challenges and Impacts of Utilizing New Technologies for Strengthening the APU-PPT Regime today, Wednesday, February 23.

"PJK should be able to identify and assess the risks of money laundering and money laundering offenses that arise in connection with the development of new products and the use of new technology," said Mahfud, quoted from his written statement after the event.

In addition, Indonesia must also increase understanding and readiness to comply with the recommendations of the Financial Action Task Force on Money Laundering (FATF).

This step, continued Mahfud, is very important because Indonesia will face a very crucial stage in the on-site visit of the FATF Mutual Evaluation Review (MER) in July. Currently, Indonesia is the only G-20 country that is not yet a member and is only an observer.

"As we all know, Indonesia's success in the FATF MER requires increasing Indonesia's compliance with the FATF Recommendation which covers various fields in the Anti-Money Laundering and Prevention of Terrorism Financing (APU PPT) program, including the development of new technologies or new technologies," said the former Chief Justice of the Court. Constitution (MK).

Furthermore, Mahfud explained that currently the development of technology used by Financial Service Providers (PJK) is increasing rapidly, including the use of Financial Technologies (Fintech), Artificial Intelligence (AI), virtual assets, and even bank FSPs that have published the use of Metaverse.

"This development of information technology must be addressed by PJK wisely and must be in line with FATF commitments," he said.

"In the FATF document regarding Developments and Challenges in New APU PPT Technology in 2021, FATF stated its commitment to support the development of new technologies and ensure that the implementation of the AML PPT program remains relevant and effective, based on risk and in line with the acceleration of digital transformation," added Mahfud.

Meanwhile, Indonesia has now updated the AML and CFT risk assessment in the National Risk Assessment (NRA) document for Money Laundering (TPPU) and Holistic Terrorism Financing (TPPT) 2021.

In addition, the government has also strengthened national cooperation to increase the effectiveness of the APU-PPT program through the establishment and implementation of the National Strategy for ML and TF for the 2020-2024 period which was determined at the meeting of the National Coordination Committee for the Prevention and Eradication of Money Laundering (TPPU) Committee, one of whose members is The Financial Services Authority (OJK) is also a member of the ML Committee.

"Based on the urgency of facing FATF MER and the challenges related to technological developments, I express my appreciation for holding this webinar," he said.

"I hope that the discussions in the Webinar, which will present competent sources both from within and outside the country, will strengthen the understanding and synergy between OJK as LPP, Financial Service Providers, and Ministries/Institutions related to APU-PPT in strategic matters," Mahfud concluded.