Slovakia Fails to Meet Expectations in Fight Against Money Laundering

European Evaluation Criticizes Slovak Authorities’ Performance

A recent evaluation by MONEYVAL, an international organization that assesses anti-money laundering (AML) and countering terrorism financing (CFT) efforts, has highlighted significant shortcomings in Slovakia’s fight against financial crimes. The report emphasizes the country’s moderate understanding of money laundering risks but also criticizes its poor performance in gathering evidence, detecting criminal assets, and prosecuting those responsible.

Key Findings:

• Slovak authorities have a good grasp of national ML and CFT risks, including organized crime, corruption, and cybercrime.
• Some prosecutors lack a clear understanding of these risks, relying on an incomplete national risk assessment.
• The country scores poorly in using financial information to gather evidence and detect criminal assets.
• Many convictions are related to simple property offenses rather than more serious crimes.

Challenges Facing Slovak Authorities

• Lack of a central bank account register and useful beneficial ownership information makes it difficult to carry out financial analysis.
• Officials at the Financial Intelligence Unit (FIU) lack coherent management guiding their activities, leading to significant deficiencies in transmitting analyses to relevant agencies.
• Preventive measures are seriously affected by logistical and procedural constraints, limitations on seizing assets from third parties, and a high burden of proof required for certain provisional measures.

Area-Specific Issues

• Terrorism Financing (TF): No convictions during the period assessed, with three complex investigations still underway.
• Financial Institutions: Slovak banks have demonstrated a good understanding of ML/TF risks, but some non-banking financial institutions and designated non-financial businesses and professions struggled to articulate how money laundering might occur in their institution or sector.

Private Sector Performance

• The private sector has generally shown an understanding of procedures for reporting suspicious transactions to the FIU and is submitting an adequate number of reports.
• However, there are still challenges in providing useful feedback to reporting entities.

Conclusion

The evaluation’s findings indicate that Slovakia needs further improvement in its AML/CFT efforts. MONEYVAL will apply its enhanced follow-up procedure to ensure the country meets international standards in combating financial crimes.