Financial Crime World

Slovakia Urged to Strengthen Financial Crime Prevention Measures

A recent report by the Council of Europe’s anti-money laundering body, MONEYVAL, has highlighted significant shortcomings in Slovakia’s efforts to combat money laundering and terrorist financing. The report calls on the authorities to take decisive action to address these weaknesses and ensure that illicit funds generated by proceeds-generating crimes are effectively seized and confiscated.

Weaknesses in Money Laundering Prevention

According to the report, Slovak authorities have a moderate understanding of national money laundering and terrorism financing risks, but significant gaps remain in their ability to collect evidence and trace criminal assets. The financial intelligence unit (FIU) is hampered by a lack of coherent management and limited dissemination of its work to competent bodies, while preventive measures are hindered by logistical and procedural constraints.

  • The FIU has been criticized for its inability to effectively disseminate its analysis to competent bodies.
  • Many law enforcement agencies, supervisors, and private sector entities rely on outdated information.
  • There is a lack of beneficial owner information and absence of a central bank account register, which hinders financial analysis.

Insufficient Asset Seizure and Confiscation

The report also notes that Slovakia has made little progress in seizing assets from third parties and recovering secured assets, with confiscation being rarely imposed in criminal cases. Additionally, there have been no convictions for terrorist financing in the period assessed.

  • The report calls for the establishment of a central bank account register to improve financial analysis.
  • Risk-based inspections by the FIU and National Bank of Slovakia are recommended to enhance oversight.

Recommendations

The report recommends that Slovakia:

  • Improve its financial intelligence gathering and analysis
  • Enhance cooperation between law enforcement agencies and supervisors
  • Increase the transparency of beneficial ownership information
  • Implement risk-based inspections by the FIU and National Bank of Slovakia

In light of these findings, MONEYVAL has decided to apply its enhanced follow-up procedure and invited Slovakia to report back in September 2022. The report’s recommendations are intended to help Slovakia strengthen its financial crime prevention measures and prevent illicit funds from being generated and laundered through its financial system.