Money laundering and terrorist financing: Commission assesses risks and calls for better implementation of the rules
The European Commission yesterday said more needs to be done to counter the multi-billioneuro flow of dirty money in the European Union as major shortcomings have emerged in the way banks and governments handle the issue.
After a recent string of moneylaundering scandals at several lenders in the 28-country bloc, the EU reviewed existing rules and practices to identify the main shortfalls, as well as counter illegal flows that Europol estimates could amount to more than €200 billion a year.
The review included shamed Maltese banks Pilatus bank and Satabank, both of which have been shut down by the Maltese authorities.
Under the review, the results of which were published yesterday, the Commission assessed 10 known cases of money laundering at banks which were reported mostly between 2012 and 2018.
The case studies included lenders that have been at the centre of large scandals such as Danske Bank, Denmark’s biggest bank, which has admitted to having handled through its Estonian branch €200 billion of suspicious transactions between 2007 and 2015.
The review also included lenders that have been shut because of money-laundering woes, like Latvia’s ABLV, Malta’s Pilatus Bank and Cyprus’ FBME Bank. It also covered cases of financial crime that led to fines or financial settlements at some of EU’s largest banks, like Deutsche Bank, the Dutch giant ING, Finland-based Nordea, and France’s Societe Generale.
Other reviewed banks were Malta’s Satabank, whose activities were frozen by domestic authorities last year, and Estonia’s Versobank, whose licence was revoked last year amid a moneylaundering investigation.
Brussels concluded that banks often did not comply with antimoney laundering requirements, while watchdogs in member states failed to prevent and effectively address the shortfalls.
“These deficiencies point to outstanding structural issues in the implementation of EU rules,” a Commission statement said.
It suggested making EU antimoney laundering rules - now often at variance in their application - directly binding on member states, and considering improvements in banking supervision.
“We don’t want any weak links in the EU that criminals could exploit,” EU Justice Commissioner Vera Jourova said.