Financial Crime World

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Croatia Urged to Strengthen Efforts Against Money Laundering and Terrorist Financing

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A recent report by the MONEYVAL committee has called on Croatian authorities to bolster their efforts to combat money laundering (ML) and terrorist financing (TF), citing a need for improvements in the country’s regulatory framework.

Report Highlights Gaps in Regulatory Framework

Despite efforts to implement Financial Action Task Force (FATF) standards, particularly in international cooperation, the report identified several areas that require attention. These include:

  • Enhancing understanding of ML and TF risks
  • Ensuring transparency of legal persons, arrangements, and beneficial ownership
  • Improving supervisory efforts
  • Strengthening implementation of anti-money laundering (AML) and counter-terrorism financing (CFT) measures by the private sector

The report also highlighted the need for effective confiscation of criminal proceeds and establishment of a national framework for implementing UN targeted financial sanctions.

Recommendations for Improvement

MONEYVAL urged Croatia to:

  • Improve coordination between the Financial Intelligence Unit (FIU), law enforcement agencies, and prosecutors when dealing with TF cases
  • Ensure that all potential TF activities are identified, analyzed, investigated, and prosecuted
  • Develop an understanding of exposure to TF risks for non-profit organizations and apply targeted measures to those entities more vulnerable to TF abuse

Croatian Financial Intelligence Unit Praised

The Croatian FIU was praised as a key source of financial intelligence, but its analysis results were not effectively utilized by law enforcement agencies. The report emphasized the importance of prioritizing ML cases, aligning judicial interpretations with international standards, and tackling delays in complex criminal proceedings.

Conclusion

As a result of the report, Croatia will be subject to MONEYVAL’s enhanced follow-up reporting process. The country must take concrete steps to address the identified gaps and strengthen its efforts against money laundering and terrorist financing.

Note: MONEYVAL is a monitoring body that assesses countries’ compliance with anti-money laundering and combating the financing of terrorism standards.