Financial Crime World

Ireland’s Efforts to Combat Money Laundering and Terrorist Financing Receive Mixed Review

Ireland has made some progress in its efforts to combat money laundering (ML) and terrorist financing (TF), but a recent report suggests that there are still areas for improvement.

Understanding of ML and TF Risks

The report notes that Ireland has a reasonably good understanding of its ML and TF risks, with its National Risk Assessment identifying specific threats and vulnerabilities. However, the focus of law enforcement authorities appears to be more domestically orientated, with limited attention paid to international ML and TF risks.

Domestic Orientation

Ireland’s law enforcement authorities seem to focus primarily on domestic issues, neglecting international ML and TF risks.

Financial Intelligence Unit (FIU)

The FIU was found to have a good understanding of domestic and international terrorism threats and TF risks. However, its ability to perform strategic analysis is limited due to its IT framework.

Limited Analysis

The FIU’s IT framework limits its ability to perform strategic analysis, hindering effective combat against ML and TF.

Anti-Money Laundering Supervisory Committee (AMLSC) Action Plan

Although there are no specific national AML/CTF policies in place, the AMLSC has laid out an Action Plan to address certain ML and TF risks. However, this plan needs further development to ensure effective implementation.

Action Plan

The AMLSC’s Action Plan is a step in the right direction, but it requires more detailed development to achieve its goals.

Financial Intelligence and Investigations

Financial intelligence is accessed and used in investigations to develop evidence and trace criminal proceeds related to ML and predicate offences. However, most ML cases are associated with investigations into fraud and drug trafficking, which corresponds with the major ML threats identified by Ireland.

Limited Focus

The majority of ML cases focus on fraud and drug trafficking, neglecting other significant ML threats.

Sanctions and Confiscation

Ireland’s strong ML offence is hindered by a lack of convictions for ML after a trial. There have been no sanctions against legal persons, and the sanctions applied to natural persons are not effective and dissuasive.

Limited Sanctions

Ireland’s sanctions on individuals and companies are ineffective in combating ML and TF.

Confiscation Framework

Ireland’s framework for confiscation is generally sound, with confiscation pursued as a national policy objective. However, the value of criminal proceeds confiscated appears modest within the context of Ireland’s ML risks, and there is limited tracing of assets abroad to deprive criminals of the proceeds of crime which may have moved to other jurisdictions.

Limited Tracing

Ireland’s framework for confiscating criminal assets is effective in theory but lacks practical implementation, allowing criminals to retain their ill-gotten gains.

Recommendations

The report concludes by suggesting several areas for improvement:

  • Allocate additional resources to Customs to enhance efforts in tracing cash movements abroad
  • Consider implementing specific national AML/CTF policies
  • Improve the FIU’s ability to perform strategic analysis
  • Enhance efforts to trace assets abroad to deprive criminals of the proceeds of crime which may have moved to other jurisdictions.

Key Findings:

  • Ireland has a reasonably good understanding of its ML and TF risks
  • The focus of law enforcement authorities appears to be more domestically orientated
  • The FIU has limited ability to perform strategic analysis due to its IT framework
  • There are no specific national AML/CTF policies in place
  • Most ML cases are associated with investigations into fraud and drug trafficking
  • Ireland’s ML offence is strong, but there have been no convictions for ML after a trial
  • The sanctions applied to natural persons are not effective and dissuasive
  • Ireland’s framework for confiscation is generally sound, but the value of criminal proceeds confiscated appears modest within the context of Ireland’s ML risks