The Federal Finance Ministry has also acknowledged that Germany has major weaknesses in its fight against money laundering.
(Photo: dpa)
Berlin In Germany, the fight against money laundering has been slow. The anti-money laundering arm, the Financial Intelligence Unit (FIU), has so far forwarded only half of all suspicious cases it receives to the competent authorities. It was the Federal Finance Ministry’s response to a request from several members of the Bundestag, which was available to Handelsblatt.
“To date, of the 58,288 suspicious activity reports processed by the task force, 26,388 have been referred to the responsible law enforcement authorities,” Treasury Secretary of State Katja Hessel (FDP) wrote in response. Previously, the FIU had not processed a large number of reports of suspicious activity.
Janine Wissler, chairwoman of the Left Party, was harshly critical of the FIU: “The FIU has lost evidence of as many as 26,000 money-laundering cases within itself, which have then been partially shelved for more than four years.”
Last year, for example, it was understood that approximately 100,000 reports of suspected money laundering were not processed at the FIU between January 2020 and September 2022.
Management consultants from PricewaterhouseCoopers (PwC) on behalf of the Bundesbank found that the processing backlog “remained undetected due to the lack of internal controls in the FIU”, as the Bundesliga informed the Bundestag. In addition to about 100,000 suppressed reports of alleged money laundering, the ministry also reported another 189,000 reports of “unknown (final) status”.
Money Laundering Expires After Five Years
In its reply to members of the Bundestag, the Federal Ministry of Finance announced that the processing of pending suspected cases has been completed as planned by May 2023. Since May 25, 2023, there will be “no more backlogs for the Task Force to address.”
Thelesklaf was already the head of the anti-money laundering departments in Switzerland and Liechtenstein.
(Photo: Andrea Zahler)
With the exception of STRs in the lower double-digit range that required more in-depth analysis, “all STRs assessed by the FIU as valuable were processed.
What remains unacceptable to Wiesler, a left-wing financial politician, is that the FIU forwards only nearly half of specific suspicious activity reports to law enforcement, despite having completed processing. “Due to this colossal lapse by the authorities, thousands of possible cases of money laundering could no longer be clarified or could become illegal because the investigating authorities had little time to clarify because money laundering became illegal after 5 years.”
Weeks after the glitch in processing the backlog became known, then-FIU chief Christoph Schulte resigned from his post “for personal reasons”, as it was said at the time.
At the end of March, Federal Finance Minister Christian Lindner (FDP) appointed Daniel Thelesklaf as the new head of the Financial Intelligence Unit. Thelesklaf was already the head of the anti-money laundering departments in Switzerland and Liechtenstein.
Anti-Money Laundering Issues
Not long ago, international experts also submitted a mixed report on combating money laundering to Germany. Hence, there is a money laundering problem in Germany, experts from the Financial Action Task Force (FATF) identified last fall in an analysis published every decade. “Significant improvements are needed in certain areas,” the analysis said.
The Federal Finance Ministry has also acknowledged that Germany has major weaknesses in its fight against money laundering. “We have consistently eliminated flaws, strengthened investigators and driven digitization,” Finance Minister Lindner said in a speech at Thelesklafs.
In addition to the new leadership, Lindner also wants to restructure the anti-money laundering department. The Liberal Democrat politician hopes to introduce a draft law this year to create a “Federal Agency to Combat Financial Crime”, which will be launched in 2025. The Financial Intelligence Unit will be part of the new authority.
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The FIU is the national central office for evaluating financial transactions that may be related to money laundering or terrorist financing. In 2017, she was transferred from the remit of the Federal Criminal Police Agency (BKA) and the Ministry of the Interior to customs and thus came under the supervision of the Ministry of Finance.
more: International controllers call on Germany to step up money laundering