Financial Crime World

Estonia Cracks Down on Money Laundering: An Overview of Financial Crimes Prevention in the Baltic State

The Baltic state of Estonia has taken significant strides in the prevention of financial crimes, particularly money laundering and terrorist financing. Several institutions play key roles in this endeavor.

Leading Bodies in the Fight Against Financial Crimes

  • Ministry of Finance: Setting general policy, legislation, and coordinating anti-money laundering (AML) efforts
  • Estonian Financial Intelligence Unit (FIU): Investigating and verifying potential money laundering or terrorist financing offenses

Collaborative Efforts

  • The Prosecutor’s Office, Security Police, Tax and Customs Board, and courts: Identifying and prosecuting financial criminals
  • Financial Supervision Authority (FSA): Maintaining the financial sector’s stability

Governmental Committees

  • Anti-Money Laundering and Terrorist Financing Committee: Facilitating the fight against financial crimes, chaired by the Minister of Finance
  • Advisory Committee of Market Participants: Sharing information and enhancing communications between obligated entities and entrepreneurs

Citizen’s Role

Citizens play a crucial role in preventing financial crimes, particularly those engaged in the financial sector. The following obligations apply to various entities within Estonia:

List of Obliged Entities

  • Banks
  • Financial service providers
  • Organizers of bets
  • Pawnbrokers
  • Auditors
  • Accounting or consulting service providers
  • Other traders dealing with cash payments exceeding €15,000

Additional Requirements

  • Notaries
  • Lawyers
  • Bailiffs
  • Trustees in bankruptcy

Obliged persons, excluding credit institutions, must report any transaction involving a cash payment of €32,000 or higher to the FIU. Credit institutions bear this responsibility only when providing currency exchange services. All obliged entities must register with the Register of Economic Activities to conduct their businesses in Estonia, including those specializing in SMS loans, other loans, pawnbroking, or currency exchange services.

For more information, visit the Ministry of Finance’s website.

Key Takeaways

  • Estonia’s Ministry of Finance leads the charge in setting policy, legislation, and coordinating efforts towards preventing financial crimes.
  • The FIU investigates and verifies potential money laundering or terrorist financing offenses.
  • The Prosecutor’s Office, Security Police, Tax and Customs Board, courts, and Financial Supervision Authority collaborate to identify and prosecute financial criminals.
  • An Advisory Committee of Market Participants shares information and enhances communications between obligated entities and entrepreneurs.
  • Citizens and various entities have specific roles in preventing financial crimes.