Croatia Urged to Strengthen Efforts Against Financial Crime

A recent report by MONEYVAL has highlighted the need for Croatian authorities to improve their regulatory framework and capacities to combat money laundering (ML) and financing of terrorism (FT). While efforts have been made to implement Financial Action Task Force (FATF) Standards, further enhancements are necessary to effectively tackle ML and TF risks.

International Cooperation Efforts Praised

The report commends Croatia’s international cooperation efforts in combating financial crime. However, it notes that a uniform and comprehensive understanding of ML and TF risks is still lacking. To address this, the country must strengthen its implementation of preventive measures by the private sector, ensure confiscation of criminal proceeds, and establish a national framework for United Nations targeted financial sanctions related to FT.

Key Recommendations

• Strengthen regulatory framework to combat ML and FT
• Improve capacities of law enforcement agencies to identify, investigate, and prosecute ML cases
• Enhance coordination between the Financial Intelligence Unit (FIU), law enforcement, and prosecutors
• Develop an understanding of non-profit organizations’ exposure to TF risks and apply targeted measures to those entities more vulnerable to TF abuse

Challenges and Areas for Improvement

• Limited use of financial intelligence analysis results by law enforcement agencies
• Inadequate prioritization of ML case identification, investigation, and prosecution in line with the country’s risk profile
• Lack of coordination between FIU, law enforcement, and prosecutors

Conclusion

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Croatia is encouraged to prioritize implementing the above recommendations to enhance its efforts against financial crime. The report’s findings are based on the 40 Recommendations of the Financial Action Task Force (FATF) and the FATF assessment Methodology. As a result, Croatia will be subject to MONEYVAL’s enhanced follow-up reporting process.