By Louis Goss
Germany has set out plans to start a new country-wide financial crime authority with a view to strengthening the country’s responses to sanctions breaches and white-collar crime.
The plans will see Germany’s finance ministry combine the country’s more than 300 financial crime agencies into a new federal authority, in line with plans to “curb financial crime” in Europe’s largest economy.
Germany’s finance minister Christian Lindner said: “Germany must no longer have the reputation of a money laundering paradise.”
“We have the courage to make a big splash: With efficient and effective structures, we will ensure that honest merchants are protected from those who do not follow the rules.”
The proposals come as a series of high-profile fraud cases – including the multi-billion-euro Wirecard scandal – have undermined the reputation of Germany’s BaFin financial watchdog.
Recent allegations of fraud against Berlin property firm Adler heightened concerns about Germany’s financial regulators, after KPMG refused to sign off on the firm’s accounts in April.
The war in Ukraine, and the far-reaching sanctions regime launched in response to it, have overloaded Germany’s authorities and strengthened the necessity for proper enforcement of anti-money laundering rules.
The launch of the new authority will see Germany seek to bolster its fight against white-collar crime by training a new cohort of “highly qualified financial investigators” to work in the new body.
The efforts will also see Germany’s registers of beneficial ownership digitalized and combined onto a single register to boost the effectiveness of the streamlined body’s response to white collar crime.
The new federal authority will seek to take on board of the G7’s Financial Action Task Force (FATF), which in a report this month, called on Germany to strengthen its responses to money-laundering and terrorist financing by making better use of technology, and taking a more proactive approach.
The FATF report warns that as the European Union’s largest economy, Germany faces “significant money laundering and terrorist financing risks”.
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