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06 February 2013

EU watchdog blasts latest anti-money laundering plan

Europe's latest anti-money laundering proposals -- unveiled yesterday -- could have been more ambitious, complained leading independent corruption busting campaigners.

By James Barnes

EU proposal hung out to dry

 ‘This proposal is of huge importance for the EU’s fight against corruption’, said Jana Mittermaier, director of the Transparency International EU office in Brussels. ‘It needs to be as difficult as possible for the corrupt to disguise their illegally acquired assets in the EU’s legitimate economy.’

Important step

Although the organisation accepted the European Commission proposals are an ‘important step forward’ in closing loopholes frequently abused by fraudsters, they also claim that some issues have received less attention than necessary to make an impact.
In particular, the lobbying group highlights requirements for collection of beneficial ownership information, which it says falls short of what many financial institutions and law agencies have called for.
A leading lawyers group in Europe also questioned the requirement for beneficial ownership information, suggesting that the approach will be ‘likely to impose significant administrative burdens on legitimate companies, with subsidiaries having to be kept updated on share ownership changes across entire company groups, possibly on a daily basis’.

Information collection

The Law Society of England and Wales -- that jurisdiction’s professional body for solicitors -- added that it is unclear how the collection of information will make a significant difference to the battle against financial crime, owing to the specific approach that criminals have taken to laundering funds.
Law Society officials also suggested methods of tackling the misuse of companies, including requirements that all persons able to incorporate companies by way of business should be supervised for compliance and required to undertake due diligence irrespective of the value of the transaction.

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