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French Lawmakers Accuse British of Being Soft on Money Laundering - 2001-10-10

French lawmakers have issued a scathing report, accusing the British government of being soft on money laundering. London has denied the charges, which coincide with new international efforts to stop the flow of funds to terrorists.

Among other charges, the report to the French National Assembly asserts terrorist groups have found a financial refuge in London, taking advantage of allegedly permissive British financial laws.

The report, written by Socialist party lawmaker Arnaud Montebourg, also says the British islands of Guernsey and Jersey were becoming "black holes in world finance," by making so-called strategic choices that ultimately benefited money-launderers.

The British government has reacted quickly to the report. A government spokeswoman acknowledged to the French news agency, AFP, that money laundering was a problem in London, as in many other cities.

But she said suggestions the city facilitates money laundering were groundless and offensive. And during a visit to Paris, the head of a financial commission for the island of Jersey told AFP the report was "silly" and "should not be taken too seriously."

Since the September 11 strikes in the United States, Western and Middle Eastern governments have begun cracking down on assets allegedly linked to terrorist groups. The British government has announced it will adopt new laws designed to impede the flow of funds to terrorist groups.

This is not the first time a report by Mr. Montebourg has stirred controversy. Earlier reports he has done on money laundering in Liechtenstein, Switzerland, and Monaco have prompted fierce rebuttals from those governments. At home, Mr. Montebourg unsuccessfully petitioned to have French President Jacques Chirac impeached for alleged financial improprieties.