EU targets dirty money
LIEGE, Brussels (CNN) -- Measures to crack down on money laundering and boost the continent's beleaguered airlines have been agreed by EU finance ministers.
Ministers and central bank chiefs joined the U.S. 'war on terrorism' following the attacks in New York and Washington with a raft of new measures.
They agreed to draw up tougher controls on the financing of crime and strengthen powers to freeze suspicious financial assets, as well as assets of Afghanistan's Taliban administration.
There will also be better cross-border coordination of information to track terrorist funds.
At an informal meeting in the Belgian city of Lieges, they also stepped up investigations into suspicious insider trading ahead of the September 11 attacks on the United States.
A study by the German central bank points strongly to "terrorism insider trading" in airline and insurance company shares as well as gold and oil, said Bundesbank president Ernst Welteke.
"If you look at movements in markets before and after the attack, it makes your brow furrow. But it is extremely difficult to really verify it," The Associated Press quoted Welteke as saying.
Nevertheless, he said he believed that "in one or the other case it will be possible to pinpoint the source."
Investigations are also under way in Belgium, France and other countries, looking for suspicious trades before the attacks sent stock prices plummeting, said Belgian Finance Minister Didier Reynders, who chaired the meeting as his country holds the EU presidency.
Agencies in all 15 EU countries were ordered to prepare a joint report on the investigations by October 16.
The new rules agreed by the EU finance ministers on Saturday will be formalised at a meeting in early October.
'No safe haven'
The European Union money-laundering directive, which has been under discussion for some months, is expected to be fast-tracked into legislation.
UK Chancellor Gordon Brown said: "It is our intention that not only is there no safe haven for terrorists, but there is no hiding place for terrorists' money."
Authorities in France, Germany and Britain have already moved to shut down bank accounts and freeze the funds of suspected terrorists. France has extensive business relationships with the Arab world and hopes to use that network to its advantage.
French Finance Minister Laurent Fabius said: "Because we have a good relationship with Arabic countries, we can try to involve them in the common fight against terrorism.
"It would be a catastrophe if it was a fight between Western and Arabic countries. It is not at all," said
Insurance for airlines
For airlines, EU finance ministers agreed to offer for one month essential war risk insurance no longer available in the insurance market.
Individual governments are supposed to charge reasonable premiums for the service, but in some cases the premiums may be waived. Airlines were warning that without such insurance cover they might have to stop services.
The emergency measure stops far short of the $15 billion aid package the United States is providing for its airlines, but it satisfies one of the requests of European carriers.
"Government support will be limited to address a specific short-term failure in the commercial insurance market to ensure that third-party cover for war and terrorism remains available," said Belgium's Reynders.
Even before the attacks, some European carriers were in trouble -- Belgium's Sabena and Swissair both suffering from heavy financial losses.
Now, in addition to increased security costs, airlines face an estimated 30 percent downturn in trans-Atlantic passenger numbers since the September 11 attacks.
British Airways has 7,000 jobs will be cut, Germany's Lufthansa is postponing plane orders, and Spain's Iberia says it cannot rule out redundancies.
"The big airlines are quite severely impacted by this in a way that they weren't a week ago. None of the big airlines would have remotely considered trying to get state aid of any kind. They've been campaigning for years against that," said Andrew Barker of UBS Warburg.
But some low-cost carriers aren't sympathetic. They're responding by cutting fares to fill up their planes. They say bigger airlines should do the same.
The long-term outcome of the airline industry's current plight could be a series mergers and alliances, with once-difficult regulators removing some of the obstacles that have stood in the way.
-- CNN's Diana Muriel and Tom Bogdanowicz contributed to this report --
Cutting off funds for terror
September 21, 2001
Europe agrees anti-terror laws
September 20, 2001
Financial sleuths arm themselves to follow money trail
September 22, 2001
Peace rally at EU meeting
September 23, 2001
Belgium Finance Ministry
Belgian EU Presidency
Note: Pages will open in a new browser window
External sites are not endorsed by CNN Interactive.
WORLD TOP STORIES:
|Back to the top|