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Law and Economic Crimes in Europe

Die größte in der Ukraine wirtschaftlichen Bildungseinrichtung, Trainingszentrum Ökonomen , Manager und Juristen. Seine Geschichte reicht zurück bis 1906, als sie handelsüblichen Sätzen entdeckt wurden. Seit zwei Jahren bildete das natürlich Kyiv Kommerzielle Institute , davon 4 Jahren erworben , den Status von Kiew State Commercial Instituts ist.

 

Im Jahre 1920 wurde das Institut in Kiew Institut für Sozial-und Wirtschaftswissenschaften reformiert und später umbenannt in Kyiv Institute of National Economy in den Bereichen Wirtschaft, Genossenschaft , Industrie-, Rechts-und Verwertung von Fakultäten . Industriellen Wirtschaft, Buchhaltung und Vertrieb, Finanz-und Bankenkrise , die später in Kyiv Finance and Economics Institute entwickelt : Später am KING wurde drei unabhängigen Institutionen gegründet. Letztere später mit dem Kharkov Finance and Economics Institute zusammengeführt und bildeten die Grundlage für ihre finanzielle und Kiew Economics Institute.

 

Mit dem Ausbau der pädagogischen Profil der frühen 1960er Jahre , wurde das Institut umbenannt in Kiew Institut für Volkswirtschaft der fünf Abteilungen : die industrielle Wirtschaft, Agrarwirtschaft , Finanz -, Wirtschafts- , Rechnungswesen und Wirtschafts-und Wirtschafts - statistisch. König wurde zu einem der führenden Zentren der ökonomischen Wissenschaft . Im Frühjahr 1990 wurde die Anstalt in Kiew staatliche Wirtschafts- Universität umgewandelt und später vergeben nationalen Status . Heute ist es eine Art von Bildungs- wissenschaftlichen Publizierens Komplex , dessen Struktur dem die Research Institute for Economic Development , Master- Training Center , Ukrainian Institute of Stock Market , Ukrainisch Marketing Association , Ukrainian Banking Academy sind .

 

 

Kyiv National Economic Universität nach Vadym Hetman genannt - Institution mit einer langen Geschichte und herausragende Leistungen . Begann als eine private Initiative ein hervorragender Wissenschaftler und Historiker Metrophanes Dovnar - Zapolskoho , die im Jahr 1906 erreicht , dass in Kiew Kiew höhere handelsüblichen Sätzen gegründet ist - eine private Hochschule , die zweite im Reich war und die erste Universität in den ukrainischen Territorium Wirtschaftswissenschaften. Zum Zeitpunkt der Grundkursen kam zu 229 Beschäftigten und 22 Lehrer.

Im Jahr 1908 Kiew höhere kommerzielle Kurse wurden in Kyiv Kommerzielle Institute reorganisiert und erhielt einen eigenen Zimmer Bibikov Boulevard Nummer 22/24 (jetzt - bul.Shevchenka ) . Stieg die Zahl der Studierenden - bis etwa 1000 , und das Lehrpersonal nummeriert 34 Personen .

Während des Ersten Weltkrieges , Kyiv Economics Institute nach Saratov , die im Herbst des Jahres 1916 wurde evakuiert , war das Institut in der Lage, nach Kiew zurückkehren . Damals war die Institution Dovzhenko eingegeben hat : July 28, 1917 bewarb er sich um beizutreten. Während der Befreiungsbewegung von 1917-1920 ist einer der Absolventen ( M.Kovalevskyy ) war ein Minister der UPR , und ein weiteres Diplom in S.Ostapenko Anfang 1919 führte die Regierung UNR Directory. Vertreter des Lehrkörpers des Instituts eingeladen (ursprünglich der Zentralrat , und dann die Hetman Regierung ) als die besten Experten, um Komponenten der Wirtschaftspolitik zu entwickeln. Teil ihrer Räumlichkeiten zu anderen neu gegründeten Institut bereitgestellt Ausbildungseinrichtungen und auch im Herbst 1918 Ukrainischen Akademie der Wissenschaften gegründet.



Nach der endgültigen Festlegung der sowjetischen Macht in der Ukraine Institut ging in staatlichen Besitz und änderte seinen Namen - von 1920 bis 1930 hieß es Kiewer Nationalen Economy Institute ( seit 1924 - der Name Ye.Bosh ) . Im Jahr 1930 wurde das Institut geteilt , dann Kyiv Institut für Nutzung und Verteilung beseitigt wurde , und Kyiv Finance and Economics Institute im Jahre 1934 zog nach Charkow, wo er bis 1941 blieb . Loslassen im August 1943 Kharkov auf die Tagesordnung gesetzt , um finanzielle und wirtschaftliche Instituts wiederherzustellen. Mangel an geeigneten Einrichtungen in Kharkiv und ständiges Bestreben des Instituts zur Rückkehr nach Kiew bestimmt das Schicksal der High School - gewinnen Unterstützung für eine Reihe von nationalen und EU- Staats-und Regierungschefs - das Institut hat die Erlaubnis, nach Kiew im Jahr 1944 zurück empfangen und nahm die Arbeit in seiner Heimatstadt , immer ein Finanz-und Kyiv Economics Institute.

Im Jahr 1960 beschloss das Ministerium für Höhere Bildung und Secondary Specialized der UdSSR , um den Kiewer Institut für Finanz-und Wirtschaftswissenschaften an der Kiewer Institut für Wirtschaft ( 1969 wurde er mit dem Namen Korotchenko gegeben ) umzubenennen.

Mit der Wiederbelebung der Unabhängigkeit der Ukraine Kiew Institute of National Economy hat große Anstrengungen unternommen , um zu aktualisieren und die Inhalte der ökonomischen Bildung , die Verbesserung der Ausbildung für die verschiedenen Zweige des Staates, und die Schaffung von geeigneten wissenschaftlichen und pädagogischen Literatur gemacht . Daher das Ministerkabinett der Ukraine vom 25. August 1992 wurde Kiewer Nationalen Institut der Wirtschaft Kyiv staatliche Wirtschafts- Universität umbenannt . A 27. Februar 1997 durch den Präsidenten der Ukraine Kiew staatliche Wirtschafts- Universität hat die nationalen Status erhielt .

Im Jahr 2005 wurde der Kyiv National Economic Universität den Namen eines prominenten ukrainischen Ökonom , Gründer der Landeswährung der Ukraine , der Erbauer des Bankensystems V. Hetman ( die ökonomische Bildung erreicht innerhalb der Mauern der Universität) gegeben .

Derzeit ist die Struktur der Kiewer Nationalen Wirtschaftsuniversität im.V.Hetmana präsentiert neun Fakultäten : Wirtschaft und Management , International Economics and Management, Recht , Personalwesen und Marketing, Rechnungswesen und Volkswirtschaftslehre , Ökonomie des agro -industriellen Komplex , Finanz -, Wirtschafts -, Kredit- und Wirtschafts-und Informationssysteme und-technologien . Die Zahl der Studierenden ist mehr als 38 Tausend Menschen.

Law and Economic Crimes in Europe

 

Section 1: Fraud

This section outlines the recent crimes in the countries of the European Union, the successor of the European Eco­nomic Community.

 

Text l

Fraud against the Community and the present Union is not a question of petty pilfering but of large scale organised financial crime. The most frequent type of fraud is the one involving tobacco and cigarettes. It occurs in Germany, Belgium, Spain, France, Ire­land and Italy. Fraud concerning agricultural products is carried out in most Union countries; specifically for beef (Belgium, Germany, France and the United Kingdom), cereals (Germany, Italy and Por­tugal), milk products (Germany, Spain, Italy and the United King­dom), and olive oil (Spain, Italy and Portugal). Industrial goods are rarely used for fraud, with the exception of textiles. Customs of­fences receive the most frequent mention, with several reports dwelling on frauds affecting the Community or international tran­sits (Belgium, Spain, France and Italy).

The following case related to the European Community's Tran­sit System gives the idea of the way in which fraud against the budget of the European Union (EU) is committed. It is a fact that organised criminals are increasingly avoiding payment of customs duty by fraudulently exploiting the European Community's Transit System. The procedure is the following: under the system the owner of goods is responsible for the payment of duty. However, the des­tination of some goods requires the freight forwarder to become re­sponsible for the payment of customs duty instead of the owner. These goods are classified as Community Transit goods. All im­ported goods for consumption within the European Union are sub­ject to customs duty. However, the EU does not require the pay­ment of customs duty when the goods are classified as Community Transit goods. Since they ordinarily originate outside the EU but always pass through one or several member states. The system al­lows a consignor to transport goods without repeatedly having to pay and reclaim customs duty with every country. When goods are transported, the EU requires a guarantee to cover any potential customs duty loss in cases where goods.are thought to have been consumed within a member state country not designated as the final destination. The freight forwarder provides the guarantee because he has legal possession of the goods and is responsible for duty and taxes.

The freight forwarder is able to absolve himself of the guaran­tee after proving that the goods reached their destination. This is usually done when the EU customs official at port of entry is shown documentary proof that the goods have left an EU customs port of exit. The documentation that regulates the Community Transit, the 'Tl Form', is the official customs stamp on page five of the docu­ment. Its return to the port of entry relinquishes the freight for­warder from responsibility. If page five of the form does not arrive or is proved fraudulent, customs enforce the guarantee.

 

 

Text 2

Criminals abuse the system by pretending to be legitimate con­signors wishing to ship goods through the EU customs area to a consignee outside the EU. The consignor asks the freight forwarder to put up a guarantee to cover any customs duty. The goods arrive at a port of entry and customs are told these are Community Transit goods destined for a consignee outside the EC customs area. The goods are then transported. It is common for a cargo trailer to be towed by a chain of different hauliers and it is this part of the sys­tem that is open to abuse. Before the goods leave the EU customs area they are diverted and sold.

The most common method adopted by criminals is to ensure a driver is part of the chain of hauliers. The driver deliberately delays reporting the Joss of the cargo. If a freight forwarder makes inquir­ies the driver might falsely say that he has been delayed because of mechanical problems. Once customs officials at the port of entry become aware of the situation they enforce the guarantee and the freight forwarder has then effectively to pay the customs duty for the fraudulent consignor. The freight forwarder might then claim on his insurance which, in turn, will result in higher premiums or re­fusal of future cover.

These are variations of this fraud. The freight forwarder may be part of the scheme so that when customs try to enforce the guaran­tee they find it worthless. Alternatively, a customs official is cor­rupted with bribes to issue fraudulently the Tl document or crimi­nals may use a counterfeit stamp.

The last two methods are designed to mislead the customs offi­cials at port of entry into believing the goods have left the EU. Criminals, in almost the same way, abuse the Transportes Interna­tionale Routiers (TIR) system. The system is regulated by the Inter­national Road Transport Union. But, unlike the EU and EFTA, the TIR system encompasses 57 members. Many countries are «emerging democracies» and their lack of stability can encourage fraud.

This kind of fraud can be illustrated by the following example:

• March 1998: a consignor wants to ship cigarettes from Poland to Spain. At the Polish-German border the carrier contracted by the consignor asks the freight forwarder to issue a Tl document. Because of the sensitivity of the goods, the freight forwarder is­sues a Tl document for one container and decides to wait until the goods are received by the buyer before issuing more Tl documents.

• April 1998: the first Tl document is returned with customs stamps and signatures. The freight forwarder then issues an­other Tl document for a second container.

• May-October 1998: As the earlier shipments were uneventful the freight forwarder issues Tl documents for 11 containers.

• January 1999: the freight forwarder is notified that the customs stamps on the Tl documents were forged and he is liable for duties and taxes because the goods are not proved to have left Germany. If the freight forwarder had been informed earlier, he would not have issued the subsequent Tl documents.

 

Within the EU 18 million T1 documents are issued annually. Each has an average duty and tax liability of Euro 24,000. Each year Euro 432 billion of taxes and duties are channelled through the T1 system. An incidence of fraud of 0.2% has been calculated by the TIR system, meaning freight forwarders are liable for more than Euro 864 million each year.

The European Commission reckons that the financial impact of organised crime on each member state from 1994 to 1998 was in excess of Euro 75 billion.

The CT regime was designed in the 1960s for six countries with internal borders. Today, transit is organised by freight forwarders acting as intermediaries to a transaction in countries with no inter­nal borders. In addition, customs budgets have been reduced in relative terms and customs authorities have not been able to keep pace with an increasing workload. All this points to the fact that the proliferation of fraud is directly related to the implementation of a frontier free EU.

The present system places the burden of preventing fraud onto the freight forwarders. The prevention of fraud takes expertise and time. Those freight forwarders acting unilaterally to stop the fraud have found that their ability to process the T1 form transactions has slowed down dramatically and the resulting costs, which they pass on to their customers, have increased dramatically too. This has re­sulted in customers shifting business to freight forwarders who are more trusting and less punctilious.

 

Voeight forwarders who act alone have been unsuccessful. The adverse factor of a protracted processing time, caused by investi­gating the consignor, has resulted in long delays when issuing a T1 document. This delay causes financial loss to both the client and the freight forwarder.

If the system is to work, freight forwarders must be able to swiftly Verify who their clients are. New proposals must be adopted. Commercial Crime Services, a department of the Interna­tional Chamber of Commerce, believes all organisations involved in the issue of CT documentation and guarantees should be required to meet agreed standards of financial integrity and business ethics. It also believes that documentation should be controlled and each movement be identifiable by ensuring that every T1 document is sequentially numbered and issued from a central EC Customs Of­fice. Analysis should be carried out of the methods, types and ex­tent of fraud and those involved. The information obtained should be collated and disseminated throughout the operators of the CT system, and that contact and liaison points should be available to provide confidential advice to freight forwarders, transport opera­tors and guarantors as well as national bodies.

The fact that there is an evolution in the organisational aspect of fraud is clearly stated by the European Commission in the last report of May 1997. Being organised does not mean that frauds are necessarily committed by traditionally organised crime groups. Al­though it does happen in some countries (in Italy 19% of those re­ported for fraud have criminal records and are concentrated in the southern regions), it is not the rule for Europe. Different types of organised criminals commit fraud. Many points are not clear: What is their level of expertise? How complex is their organisational structure and to what extent do they use consultants? And which kind of consultants? Private experts or corrupted customs person­nel? The only clear issue is that some level of organisation is re­quired in order to commit such complex fraud, as that against the financial interests of the European Union. Too little is known and more analysis should be made in this area in order to gain a thor­ough understanding and to act with proper instruments.

 

 

The results of a comparative analysis carried out by the European Commission show the level of responses member states have devel­oped with regard to fraud against the budget of the European Union.

The national Criminal Codes or equivalent bodies of legislation all make provision for offences that can embrace both the Commu­nity's and the member states' financial interests. Of these, obtaining by deception, forgery and issuing forged documents and fraudulent conversion are the most important. Some member states (the Neth­erlands, for example) list dozens of provisions to be found in a great number of separate enactments that can be used against fraud­sters, depending on the form the fraud takes.

Most member states believe that the ordinary criminal offences are adequately defined to protect the Community's financial inter­ests. Assimilation for enforcement purposes is implied in provisions creating offences and penalties that are applicable in like manner: to Community and national interests.

Even so, it is clear from some of the reports that the trend is to­wards making fraud against the Community's financial interests an offence in its own right. The trend has gathered momentum with the Convention on the protection of the Community financial interests on which an agreement was reached at Cannes and which was signed on 26 July 1995. Article 1(2) requires member states to take the necessary and appropriate measures to transpose into their criminal law the provisions of Article 1(1) (defining what consti­tutes fraud against the Community's financial interests) so as to make the conduct described therein a criminal offence. The pur­pose, as is clear from the explanatory report, is that member states should make fraud either a specific or an express offence or at least bring it within the general definition of the offence of fraud.

There is a trend towards the development of multidisciplinary con­trol structures with responsibility for all areas of fraud prevention and with wide-ranging investigative powers. In this way the member states hope that more effective steps can be taken to combat organised finan­cial crime which is not necessarily confined to one particular sector.

 

 

There are many examples of this. In the United Kingdom the SFO (Serious Fraud Office) has multidisciplinary investigation teams; in 1992 the NCIS (National Criminal Intelligence Service) was set up to combat serious crime, including economic crimes. In Belgium the Central Office for the Prevention of Organized Eco­nomic and Financial Crime consists of members of the Criminal In­vestigation Department, the Gendarmerie and the CSC (a high level control committee) and, since the Tax Act of 30 March 1994, offi­cials responsible for customs, direct taxation and VAT. A general directive states that the Office's powers extend to all serious finan­cial, economic or tax offences involving organised crime, and in particular fraud to the detriment of the financial interests of the European Union.

Similarly, Italian legislation should shortly assign to, the Guardia di Finanza the essential task of monitoring and investigat­ing Community fraud, thus making it a key instrument of a policy laid down at the highest level, namely the Interministerial Commit­tee for the Prevention of Community Fraud. This Committee was set up in the spirit of Article 209a of the Treaty on the European Union, by Act NQ 142of 19 February 1992, and is under the Prime Minister's own department for the coordination of Community policies, where the operational unit of the Guardia di Finanza established by Decree of the Prime Minister, dated 11 January 1995, is located.

As regards the administrative organisation of fraud prevention, the national reports indicate on the whole that there is a great con­trast between the protection of revenue and the protection of ex­penditure. Where revenue is concerned, customs and tax authorities have had long experience of fraud prevention and apply the same control methods to Community revenue as have proved their worth in decades of use at national level. Both national and Community revenue may thus be said to enjoy a high level of protection.

There are few examples of departments responsible for the monitoring of Community expenditure which are both independent of the administrative authorities and experienced in the field of fraud prevention. According to the national reports, controls tend to be the responsibility of bodies whose work involves the general auditing of government departments and the verification of ac­counts rather than detailed checks of Community expenditure.

Between the forces of dissuasion represented by high-level in­stitutions, on the one hand, and the primary checks carried out by the administrator himself, on the other; there is room for specific fraud-prevention controls carried out by specialists in the fight against organised financial crime, who should be independent of the special staff administering funds and who should hold wide-ranging powers of investigation. If the controls applicable to expenditure could be raised to the level of those currently applied to revenue, the protection of both national and Community finances would be considerably enhanced.

 

The money launderer changes the illicit proceeds from one form to another, often in rapid succession. The trend is towards acquiring tangible assets (such as cars, boats, aircraft, luxury items, real es­tate, and precious metals) with the bulk cash originating directly from criminal activity. Often, but not necessarily linked with off­shore centres, the mechanism of shell or front companies has been detected. These are entities that generally exist only on paper. These legal entities are usually conducted specifically in order to carry out a wide range of criminal businesses such as financial fraud, especially in the United Kingdom, and fraud against the European Union, especially in the Netherlands, Belgium and Italy. They do not participate in actual commerce and are run by straw men, as often found in Italy. Their purpose is quite exclusively criminal and they often face a «law enforcement risk» from investi­gations about the real nature of their existence. This is the reason why they are closed down almost as soon as they are formed and often the accountancy books are physically eliminated in order to conceal any trace that could help future or further investigations.

Money launderers are ever more oriented towards the use of non-bank financial institutions which are still not completely or properly regulated in some European Union member states. As they do not always come under the same obligation as the financial sec­tor, because they are not allowed to undertake banking activities to earn interest, they are used especially at the placement stage for entering the cash into the financial market. There is evidence, espe­cially in the Netherlands, Italy and Belgium, of criminal groups moving from major commercial banks to those called second line banks and often operating accounts in the name of offshore companies. These include a wide variety of bureaux de change, cheque cashing services, insurers, brokers, importers, exporters and other trading companies, gold and precious metal dealers, express deliv­ery services and other money movers. Casinos or gambling houses are used at the placement stage. Enquiries into stockbroking mar­kets in Austria, Finland and the United Kingdom have, however, revealed that much illicitly gained money is laundered in this cir­cuit. A special mention has to be made of insurance companies which are increasingly popular laundering mechanisms, as in Ger­many, especially in the premium insurance bond sector.

 

 

The use of more sophisticated money laundering methods has also gone beyond wire transfers to include a seemingly endless va­riety of licit and illicit financial instruments.

The possibility for criminal organisations to launder their pro­ceeds through banking financial institutions exists without the knowledge of the illicit source by the financial or commercial op­erator or because of a more or less explicit complicity, if not even through a corrupted or criminally controlled institution. Individu­ally or in concert, employees of financial or business institutions are in fact facilitating money laundering operations by willingly ac­cepting large cash deposits, by failing to report transactions which exceed the threshold required by the law or by filing false reporting documents. This situation occurs for example in mature financial systems which are particularly exposed to organised crime, as Italy certainly is.

There is, however, emerging concern about new banking prac­tices within the European Union, such as direct access banking (favoured customers are given the bank's software and allowed to process transactions directly through their accounts) or suspense accounts (of banks with other banks). Pass-through banking by it­self is posing a myriad of problems for regulators, by creating ac­counts within accounts, even banks within banks. These new bank services limit the utility of identification systems. Representative offices — an office representing a foreign bank that does not have a branch in a specific country constitute another privileged target used by money launderers. Normal financial regulations do not al­ways apply to them because a representative office is not an official banking institution, while the office accepts deposits and transfers the funds into its own account without disclosing the identities of the owners of the deposits.

 

 

A random reading of cases in die country analysis reveals that a new category of professional money laundering specialists is emerg­ing. These professionals have been emerging in Belgium, the Neth­erlands and Portugal as white collar criminals acting as financial ad­visers both as individuals or as organisations like firms. In the United Kingdom they emerged mainly as solicitors. In Italy they are often members of the criminal organisation or very close to it, as a branch of the same, providing specific laundering services. They sell high quality services, contacts, experience and knowledge of money movements, supported by the latest electronic technology, especially in international financial centres such as Germany or the United Kingdom, to any trafficker or other criminal willing to pay their fees. In addition to buying into established companies, or creating shell corporations in out-of-the-way venues, and buying and trading commodities, purchasing equipment, and the like, the more sophis­ticated money managers put the traffickers' proceeds into a wide range of financial instruments. The possibilities offered by impor­tant international financial and stock exchange centres in the Euro­pean Union comprise an endless variety of possibilities of diversifi­cation. They often manage funds for third parties beyond contracts such as fiduciary contracts, financial management, foundations, third party accounts and new typologies of contracts such as trust companies. Professionals number criminal organisations among their many clients, and make available to them the same mecha­nisms used by other clients to smuggle gold or to hide profits and shelter proceeds from the tax collector. In a variation on this proce­dure, some money brokers are buying cash in bulk, at a discount rate. The criminal organisations get their proceeds back from the point-of-sale countries without making the moves themselves.

These professionals once acted as brokers, charging a commis­sion for handling cash and other transactions; today, they increas­ingly buy the entire proceeds at a discount and control its disposi­tion, reaping profits by investing in legal businesses.

Organised crime is changing parallel to the way in which the laundering methods for proceeds of crimes are changing. These changes are effects of many factors, including also the policies en­acted for combating organised crime. In just a few years an interna­tional anti-money laundering regime has been built up and inside it a European network, composed of institutions, mechanisms, hard and soft norms, has been formed. The European Money-Laundering Directive of 1991 is the main instrument for future development in this network. Having a regulatory task, as addressed to the financial, institutions, and an indirect one in supporting tougher crime control policies, the Directive contributes to the future challenge of com­bining more free circulation and competition in the European mar­kets and, at the same time, less risk of infiltration of crime. Still, European countries have some difficulty in adopting harmonised anti-money laundering policies that could effectively combat this phenomenon.

 

 

There are differences in the predicate offence in the criminal legislation of the members states. Some countries (Austria, Bel­gium, Finland, France, Germany, Ireland, Italy, the Netherlands, Sweden and the United Kingdom) include in the predicate offences all sort of crimes, following the provisions of the 1990 Strasbourg Convention; some others (Denmark and Greece) have a list with specific categories of crimes and the other countries (Luxembourg, Spain and Portugal) criminalise money laundering derived from drug trafficking offences only.

These differences among member states in the range of predi­cate offences to which money laundering legislation is linked, pro­duce disparity in the prohibition of money laundering, legislations move towards the extension of the predicate crimes for the money laundering offence, including all categories of serious crimes, as recommended by Article 6, first paragraph, of the 1990 Strasbourg Convention, which obliges signatory states to criminalise the laun­dering of proceeds of «any criminal activity». Nevertheless, para­graph four of the same Article provides a clause of partial exemp­tion to this provision: according to it, each signatory state is al­lowed to limit the predicate offences to a specific list of serious crimes (for instance, organised crime, drug trafficking, terrorism, etc.). The request for exemption should be eliminated. This would move financial and credit sectors of European countries to extend the reporting provisions to all suspected money laundering activi­ties, independently of the typology of crimes. This development in the legislation will contribute to the improvement of the coopera­tion between financial institutions and law enforcement agencies.

There is recurring evidence in the country analysis of incressing shifts of suspected money laundering activities from regulated to unregulated sectors within the same state and between single mem­ber states. This trend is the result of the risk evaluation made by crime entrepreneurs; they obviously try to lower the risk of being detected.

The anti-money laundering preventive legislation of each mem­ber state must, therefore, be extended to eliminate the sectorial weaknesses. Measures will have to be studied to prevent certain sectors from remaining outside the field of the law and being possi­bly used for criminal purposes. It is necessary to pay attention to this extension. The risk of an overregulation is incumbent and ap­propriate measures should be studied for optimising the defence of the free market and the entrepreneurial activity from any unlawful actors, and the basic rules of free and equal competition character­ising it.

 

 

Text 5

If too many obligations are posed upon a specific sector or in a specific country, there is a risk of creating serious distortions among different sectors in a single member state or geopolitical distortions in a specific area of the European region because they increase costs and time devoted to the controls. The resources allo­cated for anti-money laundering controls would not directly be in­vested in the production cycle of goods or services and would be perceived as an added fixed cost in respect of other competitors who do not have to sustain those same obligations.

In this direction, Article 13 of the Directive provides for the crea­tion of a Contact Committee, whose main task is to facilitate the co­ordination and harmonisation of implementing measures between member states, including action regarding the extension of obliga­tions to additional unregulated professions and undertakings. Actu­ally, the Contact Committee is examining the possibility of creating for all European Union member states a common list of professions and categories of undertakings to be covered. In doing so, many problems arise: first of all, there is the consideration that money laundering can be carried out through virtually any kind of business. However, this does not mean that the provisions of the Directive should be applied to all kind of professions and undertakings, re­gardless of the real risk involved. Any decision in this regard should keep the balance between the obligations and duties to be imposed and the real risk of money laundering. Secondly, it is important to understand the modus operandi of internal control systems and super­visory authorities for each profession. For this reason, die specific obligations to be applied to each profession and the appropriate sys­tem to enforce them should be carefully considered.

Certain geographical areas remain scarcely regulated or not regulated at all, and some offshore financial centres are in the European continent or in territories somehow linked to European Union member states. Most offshore banks are subsidiaries or branches of banks headquartered in European Union member countries. Further extension of regulatory provisions also to these subsidiaries or geographic areas should, of course, contribute to en­hancing the effectiveness of these obligations and distribute among more actors the economic costs of these preventive policies. The non-compliance to these obligations by external countries or by institutions should be turned into an economic disadvantage, provid­ing sanctions for the institutions or into economic barriers and fiscal disincentives for the countries.

 

 


Date: 2014-12-21; view: 1656


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