The EU talks a good game on money laundering and, as in most areas, it is certainly not short of regulations and protocols. But the real problem, it is argued, is a lack of coordination.
Though Denmark has long had a reputation for financial good health, a recent enquiry found it too is now mired in money laundering: billions of Euros were laundered through the Estonian branch of one of its biggest banks, Danske Bank.
The enquiry alleged that funds approaching 200bn euros were deemed ‘suspicious’. Many of the entities and individuals flagged came from Russia and the UK, leading British authorities to announce their own investigation.
Nor is Denmark alone. Around the same time ING, the large Dutch bank, announced it had removed its most senior financial officer failings in diligence protocols relating to money laundering.
In Malta the Pilatus bank had its assets frozen by authorities after the chairman was arrested for alleged involvement in sanction-busting dealings with Iran.
Similarly, in a shocking case in Latvia a lawyer was gunned down in connection with a similar probe into sanction breaches surrounding ABLV bank, this time concerning North Korea. The case has dragged in the head of Latvia’s central bank and, consequently, the ECB and ECJ.
In August this year the EU parliament launched a major new offensive against money laundering, however experts have dismissed the plans as insufficient because they lack a central coordinating body of the scope and sophistication to match the increasingly high level and transnational character of the launderers. These issues are exacerbated by variances in the application of relevant law across different member states.
In response the Commission is looking to beef up the European Banking Authority, but there remains considerable scepticism that the plans will be sufficient to the task.