Financial Crime World

Germany Overhauls Financial Crime Fighting Structures with New Package of Laws

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The Federal Cabinet has approved a package of laws aimed at repositioning institutions and improving methods and tools employed in the fight against financial crimes in Germany. This strategic overhaul aims to adopt a “follow the money” approach, leveraging data and digital technology to track down criminals and sanctioned individuals.

Key Pillars of Combating Money Laundering

The three key pillars of combating money laundering - analysis, investigation, and oversight - will be combined under one roof. A money laundering investigation hub is set to be established within the Federal Office for Fighting Financial Crime (BBF), with a focus on effectively prosecuting significant international cases linked to Germany.

New Structures and Responsibilities

  • The Central Office for Financial Transaction Investigations (FIU) and the Central Office for Sanctions Enforcement (ZfS) will be transferred to the BBF in mid-2025.
  • A new Central Office for Money Laundering Oversight will be established, responsible for developing uniform guidelines for supervisory authorities across all non-financial sectors.

Improved Data Access and Digital Technology

A new register of real estate transactions is set to be established, providing authorities with digital access to up-to-date property data when fighting money laundering and enforcing sanctions. This move aims to enhance the effectiveness of financial crime investigations.

Enhanced Capabilities for Authorities

  • Authorities will be empowered to order the deprivation of property if the owner or beneficiary cannot be identified.
  • A procedure for administrative asset investigations is expected to be implemented in the near future.

Implementation and Expectations

The package of laws delivers on key priorities outlined in the coalition agreement and implements recommendations from the Financial Action Task Force’s assessment of Germany. The reforms are expected to deliver further measures aimed at combating money laundering more effectively, including a procedure for administrative asset investigations.

In summary, this strategic overhaul aims to improve Germany’s financial crime fighting structures by adopting a “follow the money” approach, leveraging data and digital technology, and enhancing capabilities for authorities.