Financial Crime World

Azerbaijan’s Money Laundering Laws in Disarray

A Report Highlights Deficiencies in Combatting Money Laundering

A recent report has shed light on a series of shortcomings in Azerbaijan’s laws and practices aimed at combating money laundering, raising concerns that the country is failing to effectively tackle this serious crime.

Key Weaknesses Identified

Limited Scope of Property Subject to Confiscation

  • The law only applies to “significant amounts” or “large amounts”, leaving smaller-scale money laundering operations unchecked.
  • This narrow scope may allow criminals to evade detection and prosecution.

Lack of Specific Criminal Offence for Conspiracy to Commit Money Laundering

  • Current provisions do not provide a clear legal framework for prosecuting individuals who conspire to launder money.
  • This omission hinders the ability to prosecute complex money laundering schemes.

Unclear Jurisdictional Provisions

  • The laws on jurisdiction are unclear, leaving doubt about the country’s ability to investigate and prosecute international money laundering cases.
  • This ambiguity may lead to missed opportunities for prosecution and conviction.

Need for Clarity on Prosecuting Money Laundering as a Standalone Crime

  • Prosecutors need guidance on how to test their powers to prosecute money laundering independently of other offences.
  • Lack of clarity on this issue hinders the effectiveness of Azerbaijan’s anti-money laundering efforts.

Investigations and Prosecutions

  • There has been a lack of investigations and prosecutions for standalone or autonomous money laundering cases.
  • The few recorded convictions were related to corruption offences, highlighting the need for greater awareness and training among prosecutors and judges.

Recommendations

To improve Azerbaijan’s anti-money laundering laws and practices, the report recommends:

  1. Clarifying the Scope of Property Subject to Confiscation
  2. Introducing a Specific Criminal Offence for Conspiracy to Commit Money Laundering
  3. Improving Jurisdictional Provisions to cover international money laundering cases
  4. Allowing Prosecutors to Prosecute Money Laundering as a Standalone Crime
  5. Providing Greater Clarity on How to Establish the Existence of an Underlying Predicate Offence or the Intentional Element of the Money Laundering Offence

By implementing these recommendations, Azerbaijan can strengthen its efforts to combat money laundering and prevent the proceeds of crime from being laundered through the financial system.