Financial Crime World

Estonia Unveils New Measures to Combat Money Laundering and Terrorist Financing

Strengthening Efforts Against Financial Crime

Tallinn, Estonia - The Estonian government has outlined a new strategy to combat money laundering and terrorist financing, aimed at strengthening its efforts against financial crime. This includes organizing an action plan, developing policies, and promoting national cooperation.

Key Responsibilities and Structures

The AML/CTF Committee will be responsible for overseeing the implementation of the action plan. The committee consists of representatives from various ministries, financial institutions, and regulatory bodies, including:

  • Financial Intelligence Unit
  • Eesti Pank
  • Estonian Financial Supervision Authority

Additionally, a Market Participants Advisory Committee has been established to advise on matters related to AML/CTF. Ad hoc and standing working groups have also been set up to facilitate collaboration among experts from the private sector and government agencies.

Risk Assessment Requirements

To identify and assess risks of money laundering and terrorist financing, obliged entities must prepare a risk assessment that takes into account various factors, including:

  • Customer risks
  • Country risks
  • Product risks
  • Communication risks

The assessment will help determine fields of lower and higher risk, risk appetite, and risk management models.

Updating and Submission of Risk Assessments

Risk assessment documents must be updated regularly and submitted to the competent supervisory authority upon request. Obligated entities may also seek exemptions from preparing a documented risk assessment if:

  • Their specific risks are clear and understandable
  • They implement national risk assessments established by the Financial Supervision Authority

Rules of Procedure for AML/CTF Risk Management

The government has introduced new rules of procedure for obliged entities to establish effective mitigation and management of AML/CTF risks identified in their risk assessments. These rules must include procedures for:

  • Due diligence measures
  • Customer identification and management
  • Internal control systems

Enhancing International Cooperation

This move is seen as a significant step towards enhancing Estonia’s efforts against money laundering and terrorist financing, and promoting international cooperation in these areas.

Note: AML/CTF stands for Anti-Money Laundering and Combating the Financing of Terrorism.