Financial Crime World

Estonia Takes Steps to Prevent Money Laundering

Estonia has implemented various measures to combat the illegal flow of funds and prevent money laundering and terrorist financing. The Ministry of Finance plays a key role in shaping general policy, legislation, and coordinating activities in this area.

Key Players in the Fight Against Money Laundering

  • Estonian Financial Intelligence Unit (FIU): An independent governmental authority responsible for analyzing and verifying information about suspected cases of money laundering or terrorist financing.
  • Prosecutor’s Office: Works to detect and prosecute criminal offenses related to money laundering and terrorist financing.
  • Security Police: Conducts investigations and gathers evidence to prevent and combat money laundering and terrorist financing.
  • Tax and Customs Board: Ensures compliance with tax laws and regulations, which is essential in preventing money laundering and terrorist financing.
  • Courts: Adjudicate cases related to money laundering and terrorist financing.
  • Financial Supervision Authority: Ensures stability, reliability, and transparency in Estonia’s financial sector, which is crucial in preventing money laundering and terrorist financing.

Enhancing Coordination and Cooperation

  • A governmental committee for the prevention of money laundering was established to bring together representatives from various ministries, law enforcement agencies, and regulatory bodies.
  • The Advisory Committee of Market Participants was created to facilitate information sharing and communication between market participants and regulators. This committee provides a platform for entrepreneurs and obligated persons to contribute to the development of legislation and raise awareness about money laundering prevention.

Obligated Persons

According to the Anti-Money Laundering and Terrorist Financing Prevention Act, which came into effect on January 28, 2008:

  • Obligated persons include:
    • Banks
    • Entrepreneurs providing financial services
    • Organizers of games of chance
    • Real estate brokers
    • Pawnbrokers
    • Auditors
    • Consultants

These obligated persons must inform the Financial Intelligence Unit about cash payments exceeding €15,000 or an equal amount in another currency. In some cases, notaries, lawyers, bailiffs, and trustees may also be required to follow these requirements.

International Cooperation

Estonia is a member of several international organizations dedicated to combating money laundering and terrorist financing, including:

  • Financial Action Task Force (FATF)
  • Moneyval, the Committee of Experts on the Evaluation of Anti-Money Laundering Measures and the Financing of Terrorism
  • Estonia has conducted national risk assessments in 2015 and 2020 to identify vulnerabilities and areas for improvement.

By implementing these measures, Estonia is demonstrating its commitment to preventing money laundering and terrorist financing, while also strengthening its financial sector and international cooperation.