Financial Crime World

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Financial Crime in Austria: Understanding Money Laundering and Terrorist Financing

Austria has implemented robust measures to prevent financial crime, including money laundering and terrorist financing. These illegal activities are subject to severe penalties under Austrian law, with fines and imprisonment possible for those found guilty.

The Threat of Money Laundering

Money laundering, a concealment of the illegal origins of income from criminal activities, is a significant risk for Austria’s financial sector. The country has implemented measures to prevent this crime, including:

  • The requirement for financial institutions to identify clients
  • Reporting suspicious transactions

Combating Terrorist Financing

Terrorist financing, providing assets for the perpetration of terrorist acts, is also a major concern. International standards exist to combat this crime, and Austria has implemented measures to prevent its use of the financial system.

Austria’s legal framework for combating financial crime is based on several laws, including:

  • The Financial Markets AML Act
  • The Austrian Trade Act
  • Gambling Act
  • Codes of Professional Conduct for Attorneys at Law and Notaries

The “know your customer” principle is a key element of these provisions, requiring financial institutions to identify clients and verify their identities.

Identification Requirements

In Austria, every client must be identified before establishing a business relationship or performing a transaction worth €15,000 or more. This includes:

  • Proof of identity using official photo ID
  • Proof of power of representation for legal entities and minors

Suspicions of money laundering or terrorist financing must be reported to the money laundering unit of the Austrian Federal Ministry of the Interior.

EU Directives

The EU has implemented several directives to combat financial crime, including:

  • Directive (EU) 2015/849 on the prevention of the use of the financial system for money laundering and terrorist financing
  • Regulation (EU) 2015/847 requiring specific information on payer and payee for every transfer of funds

Austria has implemented these directives through the Financial Markets AML Act and other laws.

FATF Recommendations

The Financial Action Task Force (FATF), an independent anti-money laundering organization, has established globally uniform standards for combating money laundering and terrorist financing. Austria is a member of the FATF and has implemented measures to comply with its recommendations.

Austria was examined by the FATF in 2015/2016 and found to be in Enhanced Follow-up Process. The country has also carried out a National Risk Assessment 2021, identifying risks to the sectors concerned and enabling authorities to take effective preventive action.

Statistics

As required by Article 44 para. 3 of the 4th Anti-Money Laundering Directive, Austria publishes consolidated statistics on its systems to combat money laundering and terrorist financing.