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The fight against money laundering is centred within the jurisdiction of the Ministry of Finance

18. June 2020 - 15:47

The amendments of the Money Laundering and Terrorist Financing Act, passed yesterday by the Riigikogu, brings the Financial Intelligence Unit, which until now has been a part of the Police and Border Guard Board, under the administration of the Ministry of Finance, as an autonomous institution. The transposition will take place on January 1st of the next year, as foreseen by the new legislation.

"The hindering and prevention of money laundering is an important priority for the government. It has been an eye-opening lesson for Estonia that our financial institutions were used in the money laundering cases of recent years. We must act decisively to ensure that nothing similar will ever happen again. We have already increased the funding of institutions that deal with the prevention of money laundering and enhanced the regulations. I consider changes in the institutional structure to be of utmost importance, to make the prevention of money laundering and terrorism financing more efficient. We need to focalize,” explained the Minister of Finance, Martin Helme on the need for changes.

The main aim of bringing the Financial Intelligence Unit under the administration of the Ministry of Finance is to unite the policy development of the field and its practical application.
"I believe this change will steer the Financial Intelligence Unit to become an even stronger partner for the Estonian financial sector. The prevention and detection of money laundering will certainly be more efficient in the future, when the institution is an autonomous entity, under the same administration as the Tax and Customs Board and the Financial Supervision Authority. Closer cooperation will help to unite the know-how needed to analyse this very complex financial crime," said Martin Helme.

Several responsibilities of the Financial Intelligence Unit already fit under the jurisdiction of the Ministry of Finance, such as the supervision of the activities of obligated persons, the issuing of activity licenses and suspension of the business activities of certain obliged entities.

"The government decided last year to significantly increase the funding and the team of the Financial Intelligence Unit to further the strategic analysis function. The know-how for processing the data required for strategic analysis is also available within the jurisdiction of the Ministry of Finance and greater synergy between institutions is an advantage," said Martin Helme.

The main focus of the fight against money laundering is increasingly on the prevention. The Financial Intelligence Unit needs to work more closely with the market participants and be a partner to them if necessary. The Financial Intelligence Unit, as a result of developments within the European Union, will likely pursue additional responsibilities, as the EU is striving to make cooperation and information exchange more efficient. The monitoring and analysis of developments in financial technology (fintech) and the field of virtual currencies, will also become increasingly important, in addition to traditional banking.

Estonia has been watching the developments in the global financial sector and finds the changes to be a significant step forward. Additional attention is paid to ensure that the renewed unit preserves the excellent information exchange and cooperation with the Central Criminal Police. A working group is in creation for the smooth organisation of this process, which will be led by the Secretary-General of the Ministry of Finance, Veiko Tali.

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