Financial Crime World

Title: “New Era in German Financial Crimes Fight: The ‘Follow the Money’ Approach and Structural Overhaul”

Germany’s Commitment to Fighting Financial Crimes

Germany’s Federal Cabinet recently approved a set of new laws aimed at restructuring and strengthening the country’s capabilities in investigating and preventing financial crimes. This overhaul positions Germany as a global leader in the fight against money laundering by utilizing advanced data analysis and digital technology.

Changes to Expect

The new approach will focus on the “follow the money” method, which applies data-driven investigations and continuously updates digital technology to target suspected financial criminals and sanctioned individuals. The plan combines three key pillars: analysis, investigation, and oversight.

Key Elements of the Restructure

  • Money laundering investigation hub: By mid-2025, the Federal Office for Fighting Financial Crime (BBF) will establish a new hub to tackle major international money laundering cases linked to Germany more effectively.
  • Centralized institutions: The Central Office for Financial Transaction Investigations (FIU) and the Central Office for Sanctions Enforcement (ZfS) will be transferred to the BBF.
  • Uniform guidelines: A new Central Office for Money Laundering Oversight will be created to develop coordinated guidelines for supervisory authorities in the non-financial sector.
  • Real Estate Register: This new register will enable authorities to access up-to-date real estate data digitally when combating money laundering and enforcing sanctions.

Achieving Coalition Agreement Priorities and FATF Recommendations

These new laws align with several priorities outlined in the coalition agreement and the Financial Action Task Force’s (FATF) assessment of Germany.

Additional Measures and Reforms

In an effort to intensify efforts in combating money laundering, the Federal Government plans to implement further measures, such as:

  1. Procedure for administrative asset investigations: This proposed innovation in German law aims to identify the “economic beneficiaries” of suspect assets and the origin of the funds. Constitutional considerations are currently being evaluated.
  2. Regulations: A proposed set of regulations is anticipated to be presented shortly.

[To Be Continued…]

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