Financial Crime World

Moldova Cracks Down on Financial Crimes with Stricter Sanctions

Strengthening Efforts to Combat Financial Crimes

Chisinau, Moldova - The Republic of Moldova has taken a significant step forward in its efforts to combat financial crimes such as money laundering and terrorist financing. A new law has been introduced, introducing stricter sanctions for individuals and legal entities found guilty of these offenses.

Under the new law, individuals who engage in money laundering or terrorist financing can face:

  • Imprisonment of up to 10 years
  • Prohibition on holding certain positions or carrying out specific activities for two to five years

Legal entities found guilty of these crimes can be fined between:

  • €20,000 to €27,500 (approximately 8,000-11,000 conventional units)
  • And may also face:
    • Prohibition from carrying out certain activities
    • Liquidation

Enhanced Authority for Anti-Money Laundering and Terrorist Financing Authorities

The law empowers anti-money laundering and terrorist financing authorities to impose additional sanctions, including:

  • Public statements identifying the violator
  • Prescription orders requiring individuals or legal entities to cease illegal activities
  • Suspension of business licenses
  • Fines of up to €50 million

Broadened Definition of Terrorism Financing

Moldova has also broadened the definition of “terrorism financing” to include any action that makes available or collects assets or provides financial services with knowledge that they will be used to support terrorism. This includes actions taken by:

  • Individuals or legal entities who knowingly provide funds or services to organizations, groups, or individuals involved in terrorist activities

Compliance with International Commitments and Strengthening Anti-Money Laundering and Counter-Terrorism Financing Regime

The new law is part of Moldova’s efforts to comply with international commitments and strengthen its anti-money laundering and counter-terrorism financing regime. The country has also made significant progress in combating corruption, with a range of laws aimed at preventing bribery and corruption in the public sector.

Areas for Improvement

However, experts have identified some areas for improvement, including:

  • The need to align the Criminal Code with the AML Law’s use of the term “illicit assets” rather than “illicit income”
  • Concerns about double regulation of breaches by reporting entities, which could lead to inconsistent law enforcement