According to the serious and organised crime threat assessment, money laundering is currently one of the biggest crime threats to the European Union. The global amount of money that is being laundered each year is estimated to be about €600bn. Combatting this form of crime has always been high up on the European agenda, having resulted in three directives on this issue so far. As new ways of money laundering keep arising and effective measures remain essential, a 4th anti-money laundering directive has been drawn up.
In the 4th directive on combatting money laundering a focus is placed upon beneficial ownership. Most criminal networks use obscure company constructions to avoid detection from the authorities. Moreover, these networks operate on an increasingly international level, further complicating transparency of ownership. In order to tie criminal activity to the proper persons and allow for prosecution it is essential to uncover who owns a certain company. The 4th anti-money laundering directive therefore stipulates that anyone who owns 25 per cent or more of a company should be registered as a so called beneficial owner. In my proposals I call for public registers with information on beneficial owners. I leave it to the member states to choose a lower threshold than 25 per cent if they wish so.
"Most criminal networks use obscure company constructions to avoid detection from the authorities"
The rapporteurs Judith Sargentini (Greens/EFA) and Karins Krišjanis (EPP) have mentioned creation of registers in their report but they do not call for them to be totally public. As S&D group we are very disappointed by this stance. Moreover, asking for a 'legitimate interest' in order to access a register is vague and it could lead to the opposite effect. I agree that anyone who asks information on a certain person should identify him or herself and mention the reason for the search. However, the notion of "legitimate interest" could be used to prevent rather than to share information from the registers and lead to less transparency. In this scenario members states could use "legitimate interest" to make restrictions, for example by making registers accessible only for law enforcement authorities. A register that is meant to be public should be easily accessible. Of course all the information should be treated in full compliance with EU data protection rules.
Moreover, the European commission proposal wants to broaden the scope of the directive to cover the whole gambling sector. There is an ongoing discussion as to whether certain forms of gambling which might be considered low-risk/no-risk should be exempted from the scope of the directive. As a leading person in the fight against fraud in sports in the European parliament I have seen how sports betting could be used in combination with fixed matches and often for the purposes of money laundering. As an unharmonised area, sports betting is vulnerable for criminal activities. I believe that exempting some forms of gambling from the oversight will certainly not help the current situation. All forms of gambling should first be assessed based on a risk base approach and only when it is proved, areas should be exempted, not beforehand.
Emine Bozkurt is parliament's S&D group shadow rapporteur on Prevention of the use of the financial system for the purpose of money laundering and terrorist financing