Estonia's work in money laundering prevention receives excellent assessment
The third assessment report published on 16 February 2009, by the money laundering prevention expert committee of the European Union, Moneyval, gives our work in money laundering and terrorist financing prevention a high assessment. The report is based on the assessment conducted in February of last year, in the course of which international experts assessed both the legal system, activity in financial supervision and work by the police in Estonia. Compared to the other countries assessed, Estonia received a very high compliance assessment, which is an acknowledgment of the money laundering and terrorist financing prevention implemented in Estonia as a whole, including the supervision activity in this area. The assessments of the activity by the Financial Supervision Authority in the report were predominantly good or very good.
The findings of the report confirm the relevance and effectiveness of our money laundering and terrorist financing prevention system. As a shortcoming, for instance, it was cited that the Estonian laws do not sufficiently require financial institutions to pay particular attention to business relationships and transactions with persons in whose country of location all or a sufficient number of recommendations by the FATF (Financial Action Task Force) are implemented. Also, in Estonia there has not been enough analysis of the effectiveness of legislation for the prevention of terrorist funding via the activity of non-profit associations.
On 28 January 2008, the new Money Laundering and Terrorist Financing Prevention Act took effect in Estonia, whereby the directive on the prevention of the use of the financial system for the purpose of money laundering and terrorist financing, or the so-called third money laundering prevention directive, was transposed into the Estonian legal system. The new law toughened the legislative provisions regulating client relationships, and the options were expanded for the Financial Intelligence Unit to stop transactions. According to the assessment, the legislation and activity of the relevant institutions in Estonia meet the provisions in the directive.
The issuing of the assessment by Moneyval was based on the methodology for the assessment of measures established for the implementation of recommendations by FATF on money laundering and terrorist financing prevention. The same methodology is used for assessment by the International Monetary Fund (IMF). In recent years, Moneyval has conducted similar assessments in most Central and Eastern European Countries. FATF and its subsidiary organisations have also assessed, using the same methodology, Russia, China, Japan and Mexico.