Bulgaria Urged to Improve Fight Against Financial Crimes

The Council of Europe’s anti-money laundering body, MONEYVAL, has released a recent report calling on Bulgaria to strengthen its efforts in combating money laundering and financing of terrorism.

Key Findings

• Bulgaria achieved a moderate level of effectiveness in assessing money laundering and terrorism financing risks, as well as domestic coordination, investigation, and prosecution of terrorism financing cases.
• However, it demonstrated a low level of effectiveness in areas related to:
  • Use of financial intelligence
  • Investigations and prosecutions of money laundering
  • Confiscation of criminal proceeds
  • Targeted financial sanctions

Challenges and Recommendations

• MONEYVAL commended Bulgaria for conducting a comprehensive national risk assessment but noted that the country lacks comprehensive statistics, which hinders its understanding and ability to react to risks.
• The report highlighted challenges in inter-agency cooperation between law enforcement agencies, particularly due to the lack of necessary technical tools.
• MONEYVAL urged Bulgaria to:
  • Improve use of financial intelligence
  • Investigate and prosecute money laundering cases more effectively
  • Strengthen confiscation regime
  • Take a more systematic approach to investigating financing aspects of terrorism-related offenses
  • Improve national mechanism for implementing targeted financial sanctions
  • Enhance risk-based supervision or monitoring of non-profit organizations at risk of being misused for terrorism financing

Additional Concerns

• MONEYVAL expressed concerns over the lack of measures to prevent criminals from entering certain markets, such as:
  • Real estate brokers
  • Trusts
  • Company service providers
• The report noted that there are no criminality or other fit-and-proper tests performed regarding postal money operators or shareholders of currency exchange offices.
• MONEYVAL recommended establishing market entry measures to prevent criminals from entering these markets.

Transparency and Beneficial Ownership

• Despite Bulgaria’s efforts to increase transparency in beneficial ownership regimes, MONEYVAL expressed significant concerns over the accuracy of information held in registers and by obliged entities.
• The report urged Bulgaria to urgently review policies and take action to improve this sphere.

International Cooperation

• The report concluded that Bulgaria provides generally timely and constructive assistance across the range of requests for international cooperation, including mutual legal assistance.