Serbia Falls Short in Combatting Money Laundering and Terrorism Financing
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Serbia has faced criticism for its inadequate efforts to combat money laundering (ML) and terrorism financing (FT), despite being vulnerable to these threats.
Ineffective Investigations and Prosecutions
The report highlights that Serbian authorities have not been effective in investigating ML offenses and prosecuting offenders. Most ML convictions are related to self-laundering connected to a domestic predicate offense, while organized crime remains a significant threat in the country. Smuggling, trafficking, and production of narcotic drugs are widespread forms of criminal activity, and corruption-related offenses are also a major concern.
Common Money Laundering Typologies
- Misuse of domestic and foreign legal persons
- Multiple use of wire transfers
- Purchase of real estate and valuable movable property
These typologies are commonly used in relation to all forms of proceeds-generating crime. Serbia’s exposure to cross-border illicit flows is significant, largely due to the presence of organized criminal groups with links to foreign associates.
High Risk of Terrorism Financing
Serbia also faces a high risk of FT, particularly emanating from the non-profit sector and informal money remittances. The country’s geopolitical situation is highly relevant when considering these risks, given the recent increase in Islamic radicalization and nationals joining extremist groups in the region.
Areas for Improvement
- Strengthen investigation and prosecution capabilities
- Improve transparency in beneficial ownership information
- Enhance international cooperation to address significant threats and vulnerabilities
Conclusion
Serbia’s fight against ML and FT requires significant improvement. The authorities must prioritize strengthening their investigation and prosecution capabilities, improving transparency in beneficial ownership information, and enhancing international cooperation to effectively combat these threats.