For some reason the Ministry of Finance is becoming an arm of law enforcement

Ukraine’s Vice Premier Vasyl Rohovy said, as he returned from Washington, that the Ministry of Finance was introducing a second office of state secretary. This high-ranking official, to be appointed shortly, will run the newly-established State Department for Financial Monitoring. “We are pressed for time, we must promote its (the new department’s — Author) activity,” the deputy premier said. According to him, as Ukraine is now blacklisted, the establishment of this state committee is one of the decisions aimed at changing things. The more so that all countries considerably tightened money laundering countermeasures after the September 11 events. Mr. Rohovy said that Ukraine had suffered from money laundering and thus wants this money to work for the people from whom it was actually stolen.

It will be recalled that the newly established department has been granted the status of a body of public administration acting as part of and subordinate to the Ministry of Finance. This matter once was the subject of serious debate. The State Tax Administration at first suggested that the new agency be part of it and later opposed it altogether on the grounds that the Tax Administration is already doing this kind of work. The National Security and Defense Council suggested that the financial intelligence service, as the new department was immediately dubbed, be set up within the framework of the NSDC as an institution independent of the interests of specific agencies. While the National Bank took the same stand, the Cabinet of Ministers considered itself in the best position to spearhead the planned attacks on money laundering. It is still unknown whether the Tax Administration, the Security Service, and the Ministry of Internal Affairs will share real power and information with the Ministry of Finance.

The dispute was solved, of course, by the one who issues decrees. Everyone seems, at least on the surface, to be satisfied: at any rate, open argument has almost ceased. Yet, there is still no real consensus on this point. Still more interesting is the situation with the appointment of the chief financial intelligence officer. In particular, People’s Deputy Inna Bohoslovska told The Day that, although financial monitoring is necessary, it should not be within the Ministry of Finance but subordinate to the prime minister and “set up as a separate analytical service.” If we agree that the “intelligence agents” should work under roof of the Ministry of Finance, then, Ms. Bohoslovska thinks, one person should not combine the offices of chief intelligence officer and state secretary because the task of the latter is “to organize good and high-quality work, while financial monitoring is in fact a body to evaluate this work.” It makes no sense “for one person to combine the offices of chief executor and supervisor,” the people’s deputy believes.