By a large majority, MEPs have voted to reject a European Commission proposal for a blacklist of states at risk of money laundering on the grounds it is not comprehensive enough
MEPs voted on the blacklist of countries deemed to be at risk of money laundering and terrorist financing, but said it is too limited, and should be expanded, for example to include territories that facilitate tax crimes. The resolution to send the list back for further consideration was passed by 393 votes to 67 votes, with 210 abstentions.
Judith Sargentini, an MEP from the Netherlands, who prepared the resolution and is a co-rapporteur on the underlying legislation, said: ‘The strength of the vote reflects the strength of feeling in parliament about the inadequacy of this current list. We now hope that the Commission will be more ambitious in its revisions, so as to create a blacklist which is fit-for-purpose.’
The resolution argued that whereas the Commission states that it has to identify high-risk countries exclusively on the grounds listed in the Fourth Anti Money Laundering Directive, which relate specifically to anti money laundering and terrorist financing deficiencies, the work of two of Parliament’s special committee indicated that tax avoidance and tax evasion may also give rise to problems in these areas. It calls for the Commission to introduce ‘a fully independent and non-politicised process’ to assess the risk levels in a particular country.
Krišjānis Karins, an MEP from Latvia, who is another co-rapporteur on the underlying legislation, abstained in the vote, saying: ‘A country should be placed on the blacklist only when there is clear evidence of a systematic threat of money laundering and terrorist financing. The Commission needs to have a straightforward and transparent algorithm that can withstand public scrutiny.’
Currently, the Commission lists eleven countries, including Afghanistan, Iraq, Bosnia and Herzegovina, and Syria, which it judges to be deficient in countering money laundering and terrorist financing. People and legal entities from blacklisted countries face tougher than usual checks when doing business in the EU.
Following the vote, the existing inventory of high risk third countries thought to fall short in the area of anti-money laundering and terrorism finance will remain in force while the Commission considers any revisions.
The resolution, Objection to a delegated act: Identifying high-risk third countries with strategic deficiencies, is here
