“ Estonia is an e-country with an open and forward-looking economy. It is important for us that the bad guys are unable to take advantage of these characteristics for criminal purposes. Moneyval’s overall positive assessment is the result of tight cooperation between Estonian state agencies,” said Minister of Finance Annely Akkermann.
Deputy Secretary General of the Ministry of Finance Evelyn Liivamägi added that the Estonian authorities have increased their efforts towards identifying and countering money laundering and terrorist financing risks. “Estonian state agencies have thoroughly assessed the risks of money laundering. As a result of this comprehensive work, we have identified the risks faced by Estonia in terms of money laundering, and that is where we will be focusing more of the state’s attention,” said Liivamägi, adding that such mapping also helped prepare for the MONEYVAL assessment. The swift and international cooperation and coordination of our agencies as well as effective work of Estonian FIU received the more positive ratings from the assessors.
The Financial Intelligence Unit, the Financial Supervision Authority, the Tax and Customs Board, the Office of the Prosecutor General, the Police and Border Guard Board, and the Ministry of Justice, were commended for their good international cooperation. There was overall positive feedback for the quality of the information provided, the short response times, and the high usability of the requested information. The effectiveness of our implementation of international sanctions was also recognised.
The report assessed both the content of the legislation and the effectiveness of its implementation. It was the first time that the updated FATF methodology was used to assess Estonia. The evaluators set their focus on the analysis of possible threats to the business environment as well as the state of the most vulnerable sectors, which were found to be the crypto sector and company service providers.
“In Estonia, the volume of crypto businesses has rapidly decreased. It can be said that only one out of every ten crypto-businesses is continuing to provide services under the updated regulations. This is thanks to our own stricter laws and the intensive monitoring activities of the Financial Intelligence Unit,” explained Evelyn Liivamägi, pointing out that of the 2,000 crypto businesses licensed here a few years ago, approximately 160 remain, as most of the operating licenses have been declared invalid by the Financial Intelligence Unit. The report mentions that the implementation of measures in the traditional financial sector has justified itself and the risks have largely been mitigated.
“The priority for the coming years is to implement the recommendations received from the MONEYVAL, as we continue to need more efficient systems and empowered agencies. I am glad that our governmental AML/CFT Committee was recognised as a strong coordination mechanism because the effectiveness of this initiative has also proven itself in practice for ourselves. It is here that we are able to most efficiently agree on how to proceed with the received instructions,’ said Liivamägi.
The fifth round of the mutual evaluation of Estonia in Moneyval took place in 2021 and 2022. The assessment visit was organised in the spring of 2022, and the the report was approvedin the beginning of December, at the organisation’s plenary meeting, in Strasbourg. The report is published in its entirety on the MONEYVAL website, which can be found HERE.
As background:
Money laundering is used to conceal income obtained through criminal means, through the predicate offence by which the proceeds are
earned and the crime in the form of entering the proceeds into the economy. Funds obtained from illicit activities, or dirty money, fuels the continued operation of criminal structures, and the financing of terrorism undermines the general security of society. It is a complex field, with the fight against ML/TF being continuous and of increasing importance at the international level.
MONEYVAL, the expert committee of the Council of Europe, is the European regional organization of the Financial Action Task Force (FATF), to which each country has appointed experts in the field, who also take part in evaluations. The content of the legislation and the manner in which it is implemented are both subject to regular evaluations – the evaluations take place in rounds, with each round covering all countries and jurisdictions belonging to the global network (over 200 in total). The general level of the fight against money laundering in Estonia has been assessed by MONEYVAL in 2000, 2002, 2008, and 2013–2014. Regarding the implementation of the recommendations made in the report and the elimination of deficiencies, the state must also provide regular follow-up reports, with the process being coordinated by the Ministry of Finance in Estonia, although all other ministries and agencies involved in the AML/CFT Governmental Committee are also included.