WRITTEN QUESTION E-0620/98

by Gijs de Vries (ELDR) to the Commission

(9 March 1998)

Subject: Money laundering

Money laundering is rapidly becoming one of the most pressing concerns in the fight against international crime. According to one estimate (Mr Bryan West, Vice-President of Citibank and former Superintendent of the London Metropolitan Police), every day as much as $500 million generated by criminal activities - notably drug smuggling and Russian organized crime - is being laundered in London-based financial institutions alone(1).

There is an urgent need to verify how the effectiveness of the EU Directive against Money Laundering can be enhanced. In particular, the role of the Financial Intelligence Units designated by Member States to implement the Directive must be reassessed. The many differences in the competences of national FIUs have seriously impeded the exchange of information and cooperation within the Union.

Is the Commission prepared to set up a working group at the level of experts drawn from both the public and the private sector to advise it, within a limited timeframe, on proposals to make the Directive a more effective instrument in the fight against money laundering?

Answer given by Mr Monti on behalf of the Commission

(3 June 1998)

The Commission agrees with the Honourable Member that money laundering is a serious and growing problem. It firmly believes that anti-money laundering measures can be an effective way of combating organised crime.

The Commission will soon be presenting to Parliament and the Council its second report on the implementation of Council Directive 91/308/EEC of 10 June 1991 on prevention of the use of the financial system for the purpose of money laundering(2). The report seeks to respond to the points of concern raised by the Council and Parliament (Resolution of June 1996(3)) following their examination of the Commission's first report(4). The Commission believes that the directive has been successful in mobilising the financial sector, in particular the banks, and in making access to the financial system more difficult for criminal money. At the same time it notes that the results so far in terms of prosecutions and convictions for money laundering are relatively disappointing.

The Commission is currently considering whether there is now a need for a new proposal for a directive to update and extend the 1991 directive, thus answering Parliament's call for a new initiative and responding to certain recommendations of the action plan to combat organised crime(5) approved at the Amsterdam European Council.

Like the Honourable Member the Commission is concerned that differences in the role and status of the financial intelligence units set up in the Member States to receive suspicious transaction reports appear to be an obstacle to the exchange of information and cooperation and may thus threaten to reduce the effectiveness of the Community fight against money laundering. The Commission is currently examining how best to address this complex problem.

(1) Jack Nelson, "Money-Laundering: Now Global, and Piling-Up", International Herald Tribune, 3 February 1998.

(2) OJ L 166, 28.6.1991.

(3) OJ C 198, 8.7.1996.

(4) COM(95) 54 final.

(5) OJ C 251, 15.8.1997.