Financial Crime World

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Serbia Struggles to Combat Money Laundering and Terrorist Financing

Belgrade, Serbia - Despite efforts to tackle money laundering and terrorist financing (ML/TF), Serbia still faces significant challenges in combating these crimes.

Challenges in Combating ML/TF

The Agency for Prevention of Money Laundering (APML) plays a crucial role in detecting and sharing intelligence on suspicious transactions with law enforcement agencies. However, according to a recent report, the APML has made progress in standardizing records of money laundering and terrorism financing cases, but still faces challenges in exchanging information with law enforcement and tax authorities.

Steps Taken by the Serbian Government

The Serbian government has taken some steps to improve its response to ML/TF, including:

  • Signing a memorandum of understanding (MoU) with 10 national anti-money laundering authorities in 2021 to standardize and make accessible records of money laundering and terrorism financing cases.
  • Launching new software for reporting suspicious transactions in 2023.

Investigating ML/TF

However, the country’s system for investigating ML/TF remains complex and fragmented, involving multiple entities including:

  • The Office of the Higher Prosecutor
  • Police units for economic and organized crime
  • Tax police
  • Military Security Agency

The Financial Investigation Unit, part of the interior ministry, focuses solely on identifying assets for confiscation, neglecting the gathering of evidence to prove that a crime has been committed.

Recommendations

To enhance the overall approach to countering ML/TF in Serbia, policymakers are recommended to:

  • Improve the legal framework to enable integrated financial and criminal investigations.
  • Strengthen law enforcement capacities for parallel financial investigations.
  • Enhance cooperation between financial and criminal investigation units.
  • Establish centralized reporting databases.
  • Increase awareness among civil society of the potential misuse of non-profit organizations for money laundering.
  • Strengthen civil society through capacity-building.

Conclusion

By implementing these measures, Serbia can improve its response to ML/TF and strengthen its efforts to combat these crimes.