Will Brexit Earn money Laundering Easier?
Many commentators would the EU continues to be not even close to perfect with regards to tackling money laundering. But it has at least introduced a number of money laundering directives recently that aim to stop the proceeds of crime flowing into its member states.
The most recent one, the Fifth Money Laundering Directive , is placed for implementation in 2021. Following on in the Fourth Money Laundering Directive, which ordered major changes to how businesses must take a risk-based method of money laundering and removed automatic exemptions from research, 5MLD will regulate virtual currencies, improve precautions for transactions involving high-risk countries and enhance the centralisation of bank data in member states. In short, it's a further removal of weaknesses that permit money laundering to flourish.
Membership of the EU continues to be no guarantee of protection against laundering, especially as a number of its smaller members lack either the expertise or even the resources to tackle it – as has been confirmed in many financial scandals in recent years. Such problems have led to louder calls for an EU-wide organisation to determine greater consistency between member states' identification and protection against laundering.
Yet now such arguments are actually overshadowed by Brexit. If the EU states arrived at miss the UK's expertise in identifying sources of illegal wealth and it is movement around Europe and also the rest of the world remains to be seen. But what's to provide problem is the issue of how britain's investigating agencies will be able to continue to track those proceeds of crime if they cannot benefit from the sharing of intelligence that currently continues between them and their European counterparts.
We are obviously yet to see how this issue is resolved. It is possible that, given time, new relationships is going to be forged on a country-to-country basis between your UK and EU members. But exactly how quickly they're put in place and just how effective an alternative choice to EU membership they prove to be in tackling money laundering remain to be seen.
Withdrawal in the EU means the united kingdom is not area of the EU's law enforcement agency, Europol. Europol's centralised intelligence database for members, the Europol Information System , is arguably among the world's best assets when it comes to sharing information across borders to tackle crime. And money laundering is certainly a crime that crosses borders.
Yet it appears unlikely that the UK can continue to use this, which has to hamper its tries to tackle flows of laundered money. Along with a lack of such cooperation will also be towards the detriment of countries who are still in the EU. They're unlikely to be able to ask UK expertise and intelligence as part of their money laundering investigations as seamlessly as they can as the UK continues to be within the EU.
The EU has been criticised because of its efforts to tackle money laundering in the member states not concerted or consistent enough. But at least its members have an infrastructure and dealing relationships in position.
The UK can boast tough anti-money laundering legislation. Its recent utilization of unexplained wealth orders and account freezing orders are testimony to its authorities' willingness to tackle money laundering. But soon it will not have those working relationships in position that EU members take advantage of within their efforts to tackle money laundering.
No doubt attempts is going to be made to instigate replacement arrangements. However the speed with which a patchwork of anti-money laundering agreements between the UK and other countries can be discovered – and also the worth of those arrangements when compared with EU membership – has to be a cause for concern. For both the UK and people nations still in the EU.
