Germany Moves to Strengthen Fight Against Financial Crime with New Draft Law

The German Federal Ministry of Finance has published a comprehensive draft law aimed at bolstering the country’s efforts to combat financial crime. The proposed legislation seeks to consolidate competencies under a new federal authority and implement recommendations from the Financial Action Task Force (FATF) as well as findings from Germany’s 2022 audit.

Key Provisions

• Establishment of a Federal Office for Combating Financial Crime, which will oversee two existing units:
  • Financial Intelligence Unit (FIU)
  • Central Office for Sanctions Enforcement (Zentralstelle für Sanktionsdurchsetzungen, ZfS)
• Streamlining operations to enhance the country’s ability to tackle financial crimes
• Reform of the Anti Money Laundering Act (Geldwäschegesetz, GwG) with significant changes aimed at those subject to anti-money laundering obligations

Impact on Financial Crime Legislation

The draft law aims to strengthen Germany’s fight against financial crime by:

• Consolidating competencies under a new federal authority
• Implementing recommendations from the FATF and findings from Germany’s 2022 audit
• Enhancing the country’s ability to tackle financial crimes through streamlined operations

Timeline for Implementation

Key reforms are slated to take effect as early as April 1, 2024.

This move is expected to have a significant impact on Germany’s efforts to combat financial crime and maintain its position as a leader in international financial cooperation.