Finland Tightens Grip on Financial Crime Prevention Strategies

A Proactive Approach to Preventing Financial Crimes

The Financial Supervisory Authority (FIN-FSA) in Finland is taking a proactive approach to preventing financial crimes, including money laundering and terrorist financing. In line with international standards, the supervisory authority has put in place a risk-based strategy that aims to identify areas of high-risk sectors and entities.

Key Components of FIN-FSA’s Supervision Strategy

• Customer Due Diligence: Supervised entities are required to know their customers’ businesses, including their identity, business purpose, and financial situation.
• Suspicious Transaction Detection: Entities must detect and examine suspicious transactions, and report any suspicions to the FIN-FSA and the Financial Intelligence Unit.
• Reporting Obligations: Supervised entities are obligated to report any suspected money laundering or terrorist financing activities to the relevant authorities.

Collaboration with International Partners

The prevention of money laundering and terrorist financing is a collaborative effort between Finland and its international partners. The country’s financial authorities work closely with organizations such as:

• Financial Action Task Force on Money Laundering (FATF): A global inter-governmental organization that sets international standards for anti-money laundering.
• European Union’s Anti-Money Laundering Directives: A set of regulations aimed at ensuring uniform customer due diligence procedures across EU financial markets.

Role of Finland’s Financial Authorities

In Finland, the National Bureau of Investigation’s Financial Intelligence Unit plays a crucial role in processing money-laundering reports. The Ministry of Finance is responsible for developing anti-money laundering legislation, while FIN-FSA ensures that supervised entities comply with statutory requirements.

Consequences of Non-Compliance

Failure to comply with customer due diligence and prevention obligations can result in severe consequences, including:

• Punishment under the Act on Detecting and Preventing Money Laundering and Terrorist Financing (Anti-Money Laundering Act): Supervised entities found guilty of negligent money laundering may face charges for assisting or counseling customers in suspicious transactions.

Continuous Improvement

As part of its ongoing efforts to prevent financial crimes, FIN-FSA will review its supervision strategy annually. The authority emphasizes the importance of continuous monitoring and improvement to ensure that Finland’s financial sector remains a safe haven for legitimate business activities.