New EU-wide penalties for money laundering - Main contents
-EU-wide definitions of money laundering
-Maximum jail sentence should mean five years or more
-New sanctions include banning from elected offices and public tendering
New measures to step up EU fight against money laundering and narrow the scope for organised crime were agreed by the Civil Liberties Committee on Monday.
Share this quote:
MEPs seek to introduce EU-wide definitions of money laundering related crimes, including practices that are not currently deemed a crime in in all EU countries, such as “self-laundering” (i.e. where a person who has committed a crime tries to hide the illicit origin of those proceeds).
They also seek an EU-wide minimum term of imprisonment of at least two years in cases with aggravating factors, such as organised crime. Where a judge passes the national maximum jail sentence, it would have to be of at least five years.
The aim is to step up cooperation between member states, as the lack of uniform definitions and penalties currently allows criminals to exploit these differences and commit crimes where penalties are lowest.
MEPs added a range of new EU-wide penalties for those convicted of money laundering, as compared to the EU Commission’s proposal. These include:
-barring those convicted from running for public office or holding a position of public servant,
-banning businesses and other legal persons from signing contracts with public authorities, and
-confiscating property and other assets.
The legislative resolution was passed with 39 votes in favour and 4 abstentions.
Parliament's rapporteur on the file, Ignazio Corrao (EFDD, IT), said: "Today’s vote marks an important milestone in the fight against organised crime at a European level. This directive will deprive criminals of their most important asset, money, and it will make it more difficult for criminal organisations to launder the profits of their criminal activities in the legal economy of the EU. Parliament also clearly stated that imprisonment cannot be the only penalty and provided for new additional measures such as confiscation or the ban on entering into contracts with public authorities or running for elected offices."
The Civil Liberties Committee also backed a mandate for MEPs to open negotiations with EU governments. The talks will start once the mandate has been endorsed by Parliament as a whole. Following final approval of the directive, member states will have one year to transpose it into their national laws (as against two years in the original Commission proposal).
The proposal, put forward by the EU Commission in December 2016, is part of a larger legislative package aimed at fighting terrorism financing as well as other forms of organised crime.
According to the Commission, the proceeds from criminal activity in the EU are estimated to be €110 billion per year, corresponding to 1% of the EU's total GDP. The Commission estimates that in some EU countries, up to 70% of money laundering cases have a cross-border dimension.
The proposal would set minimum rules for the making money laundering a crime across the EU. And because the legislation takes the form of a directive, member states would be free to go even further.