Ref. DC 106(2016)
Council of Europe urges Serbia to develop a clear criminal policy on money laundering investigations and prosecutions, do more to combat financing of terrorism
Strasbourg, 09.06.2016 – The Council of Europe’s anti-money laundering body (MONEYVAL) in its new report published today praised the authorities of Serbia for improving legal and institutional framework, but found that Serbia does not fight money laundering and financing of terrorism on a systematic and consistent basis. (See also the summary of the report).
The report prepared by the Council of Europe’s Committee of Experts on the Evaluation of Anti-Money Laundering Measures and the Financing of Terrorism analyses the implementation by Serbia of international standards on money laundering and terrorist financing since the last evaluation in 2009, and recommends an action plan to address the shortcomings.
Serbia faces many significant money laundering threats and vulnerabilities, the report says, the major threat emanating from organised criminal groups involved in the smuggling and trafficking of narcotic drugs and trafficking of human beings. Tax evasion and corruption offences are considered to generate substantial criminal proceeds. The purchase of real estate, valuable moveable property and investment in securities is a preferred laundering method, which makes the banking, remittances and real estate sectors especially prone to money-laundering risk. The country is also greatly exposed to cross-border illicit flows.
Serbia as the first MONEYVAL country to have conducted a full scale national risk assessment, understands these risks. However, while banks and money remittance providers were found to apply effective measures to counter the risk, this was not the case with respect to real estate agents.
MONEYVAL experts commended the authorities for the efforts in investigating one significant money laundering case connected with organised criminality, but have urged them to take immediate action to ensure that law enforcement efforts are fully commensurate with the money laundering risks faced by the country. A clear criminal policy on money laundering investigations and prosecutions should be established, including a centralised database for all the cases and a co-ordinated strategy.
With the separatist and/or extremist groups situated in the region and in certain parts of the southern regions of Serbia, the country also faces an elevated risk of financing of terrorism, particularly in relation to the non-profit sector and informal money remittances. The authorities acknowledge this and have taken measures to address the risk. However, there have been no convictions for financing of terrorism and only one prosecution. Besides, the existing mechanism of targeted financial sanctions regarding terrorism financing does not enable the implementation of the lists “without delay”. This indicates that efforts in the field of fighting financing of terrorism should be intensified.
Serbia is to report back to MONEYVAL in May 2017 about the implementation of its recommendations under enhanced follow-up procedures.
Contact: Tatiana Baeva, Spokesperson/Media Officer, tel. +33 3 88 41 21 41
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The Committee of Experts on the Evaluation of Anti-Money Laundering Measures and the Financing of Terrorism (MONEYVAL) is a Council of Europe body that assesses compliance with the international and European standards to counter money laundering and terrorist financing, and makes recommendations to national authorities. 28 Council of Europe member states are currently subject to MONEYVAL’s evaluation procedures, as well as Israel, the Holy See (including the Vatican City State), the United Kingdom’s Crown Dependencies of Guernsey, Isle of Man and Jersey and the British Overseas Territory of Gibraltar.