Czech Republic’s Progress in Combating Money Laundering and Terrorist Financing: MONEYVAL Report Urges More Action

Strasbourg, 11th February 2019

A new report published today by the Council of Europe’s anti-money laundering body, MONEYVAL, recognizes the progress made by the Czech Republic in combating money laundering (ML) and terrorist financing (FT). However, the report emphasizes the necessity of increased investigative efforts to address serious ML cases.

Assessing the Effectiveness of the Czech Republic’s Anti-ML/FT System

The MONEYVAL report evaluates the Czech Republic’s anti-ML/FT system and its adherence to the Financial Action Task Force (FATF) Recommendations. Here’s what the report says:

ML Mainly Occurs through Tax Crimes, Fraud, Corruption, etc.

ML activities in the Czech Republic mainly stem from tax crimes, fraud, corruption, phishing, and subvention frauds. The Czech authorities have conducted an extensive risk assessment but require more explicit mitigation measures.

Awareness of ML/FT Risks Varies Among Financial Institutions

Banks in the Czech Republic have a good grasp of ML/FT risks. However, awareness is comparatively lower among other financial institutions, and designated non-financial businesses and professions seemed less clear about the risks.

The Efficiency of the Existing Supervisory Model

The report questions the efficiency of the existing supervisory model, given its limited resources and their impact on its effectiveness.

Notable Legislative Reforms and Increased ML Investigations

However, the Czech authorities have made significant legislative reforms and increased efforts in pursuing ML investigations. Despite these improvements, MONEYVAL urges more investigation into serious third-party and stand-alone ML cases.

Improvements in the Legislative and Institutional Framework on Seizure and Confiscation

The report highlights the improvements in the legislative and institutional framework on seizure and confiscation. Law enforcement has conducted financial investigations related to proceeds-generating offenses and seized and confiscated significant amounts. Financial investigations into terrorism offenses revealed potential FT activities in the Czech Republic, with suspects identified in FT-related schemes.

Active Cooperation with Foreign Counterparts

The report commends the Czech authorities for their active cooperation with foreign counterparts but urges them to report back in mid-2020 as part of the enhanced follow-up procedure.

About MONEYVAL

MONEYVAL is a monitoring body of the Council of Europe entrusted with assessing compliance with international ML/FT standards and their implementation. The evaluation of the Czech Republic’s anti-ML/FT system was based on the 2012 FATF Recommendations and the 2013 Methodology.