State risks fines over laundering laws

State risks fines over laundering laws

By Seán McCárthaigh

Ireland could be facing a large fine, and daily penalties imposed by the EU’s top court, over the Government’s failure to implement EU anti-money-laundering rules.

The European Commission has referred Ireland, along with Greece and Romania, to the Court of Justice of the EU (CJEU), for failing to transpose EU legislation, which strengthens existing rules on money laundering, into national legislation.

It confirmed infringement proceedings have begun against the three countries, for failing to implement the EU’s 4th Anti-Money Laundering Directive. EU officials said Ireland had only transposed “a very limited part” of the required legislation. The European Commission has recommended that the CJEU impose a lump sum and daily penalties, until Ireland, and the other two countries, take the required action.

The EU Commissioner for Justice, Vera Jourová, said all EU member states were required to take the necessary steps to fight money-laundering, which would “dry up” criminal and terrorist funds.

“Money-laundering and terrorist financing affect the EU as a whole. We cannot afford to let any EU country be the weakest link. Money laundered in one country can, and often will, support crime in another country,” said Ms Jourová. 

EU member states had a deadline of June 26 last year to transpose the 4th Anti-Money Laundering Directive into their national legislation. The directive strengthens the risk-assessment obligations of banks, lawyers, and accountants. It also sets out transparency requirements about the beneficial ownership of companies, as well as facilitating co-operation between EU member states to identify and follow suspicious transfers of money. Ireland was notified by the European Commission in July, 2017 about its failure to transpose the directive and warned it faced legal proceedings. The Department of Justice has claimed the transposition of the directive into Irish legislation has proven complex. The European Commission said that a majority of EU member states had adopted the laws, after it had initiated infringement steps against 20 of them, including Ireland.

A spokesman for Justice Minister, Charlie Flanagan, said most of the provisions of the directive would be transposed by the Criminal Justice Money Laundering and Terrorist Financing Amendment) Bill, which has already passed all stages in the Dáil and is due to come before the Seanad after the summer recess, with all required measures due to be in place before the end of the year.

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