Financial Crime World

Sweden’s Efforts to Combat Money Laundering and Terrorist Financing Face Challenges

Introduction

Despite significant progress in combating money laundering and terrorist financing, Sweden still faces several challenges in this area, according to a recent national risk assessment.

The Challenge of Combating Money Laundering and Terrorist Financing

The Swedish government has been successful in implementing measures to prevent the misuse of financial systems for criminal purposes. However, the 2019 national risk assessment identified several challenges that still need to be addressed.

Key Concerns

  • Strawmen and Exploited Identities: The use of strawmen and exploited identities can compromise the effectiveness of Sweden’s identification system.
  • Insufficient Information and Knowledge Dissemination: There are shortfalls in the dissemination, access, and production of information and knowledge within the Swedish regime.
  • Lack of Resources and Tools: The assessment highlighted the lack of resources and tools, as well as inadequate legal basis in certain areas, posing a risk to the country’s efforts to combat money laundering and terrorist financing.

The Coordination Function

The Swedish Police Authority has been leading the coordination function since 2018, which involves 16 agencies working together to implement measures to combat money laundering and terrorist financing. This effort is based on two sets of regulations:

Administrative Regulations

  • Money Laundering and Terrorism Financing (Prevention) Act: Aims to prevent and counteract the exploitation of financial activities for criminal purposes.

Penal Regulations

  • Penal Regulations: Aim to prosecute individuals who engage in money laundering or terrorist financing.

The National Risk Assessment Report

The 2020/2021 national risk assessment is a joint effort between the members of the coordination function and provides an overview of the risks in the sectors defined under the Anti-Money Laundering Act. The report highlights the need for continued efforts to address the identified challenges and strengthen Sweden’s capacity to combat money laundering and terrorist financing.

  • Sweden’s Financial System Faces Risks of Terrorism Financing: [link]
  • Strawmen and Exploited Identities Pose Threat to Swedish Identification System: [link]

Sources

Read More

The Swedish National Council for Crime Prevention’s (Brå) report on money laundering and other forms of money management can be found here: [link]

For more information on Sweden’s measures to combat money laundering and terrorist financing, visit the Government Offices’ website or FATF’s website.