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State may lose race to host EU money-laundering agency over weak laws

Ireland previously failed to bring the European Banking Authority and the European Medicines Agency to Dublin in 2017


MEP Frances Fitzgerald says Ireland is ‘well-placed’ to host the new agency. Photo: Frank McGrath

MEP Frances Fitzgerald says Ireland is ‘well-placed’ to host the new agency. Photo: Frank McGrath

MEP Frances Fitzgerald says Ireland is ‘well-placed’ to host the new agency. Photo: Frank McGrath

Ireland won’t be able to host a new EU anti-money laundering agency unless it does more to police suspicious transactions at home, MEP Billy Kelleher has said.

The European Commission will today table proposals for a new body to coordinate anti-money laundering (AML) efforts across the bloc and directly regulate risky firms, but it has yet to decide where the agency will be located.

Leaked drafts of the proposal say it would be staffed by up to 250 people, making it much smaller than the EU’s banking and medicines agencies, which Ireland bid for after Brexit.

“Can Ireland become the host of this new agency? Yes, in theory, but unless we strengthen even more our own AML legislation such as supervising the professions that establish trusts for example, it would be a non-runner in my opinion,” said  Mr Kelleher, a Fianna Fáil MEP.

“We can’t expect to be rewarded with an additional EU agency if our own AML legislation is lacking in comparison to other member states.”

Ireland failed in its attempts to bring the European Banking Authority (EBA) and the European Medicines Agency (EMA) to Dublin in 2017, although it was neck and neck with Paris in the contest to win the EBA seat. Amsterdam snagged the EMA.

Fine Gael MEP Frances Fitzgerald said Ireland is “well-placed” to host the new agency “given that we lost out so narrowly” on the EBA. “I believe it would be an opportunity for the government to pursue,” she said.

But she said Ireland should take EU warnings to toughen money laundering rules “seriously”.

EU officials said last week that Ireland could do more to supervise lawyers, accountants and other professions that set up trusts or other legal structures on behalf of their clients.

Ireland’s position on corporate tax is also likely to work against the Government in any potential bid for the AML body.

“I would say, and I’m being ironic, that Irish tax policy has earned Ireland great credibility to win a bid for a finance agency,” said German Green MEP Sven Giegold.

The new agency would coordinate the work of national financial intelligence units, including a new EU-wide cap on cash transactions.

Ireland’s limit stands at €10,000, though other member states such as Spain, France and The Netherlands cap it at a much lower level.

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The new rules come after US authorities called out suspicious transactions at a number of EU banks – many linked to breaches of international sanctions regimes – including an Estonian branch of Danske Bank, the now-defunct Latvian bank, ABLV, and Malta’s short-lived Pilatus bank.

“It’s an embarrassment that it was our American friends that enforced the EU’s money laundering rules, and not the EU institutions,” said Mr Giegold. “We have a supervisor-in-chief sitting in Washington.”

The UN estimates that up to €2trn is laundered every year, while Europol says around 1.3pc of the EU economy –close to around €200bn – is lost to criminal transactions. But only a small amount of assets are ever recovered.

The Department of Justice’s Anti-Money Laundering Compliance Unit, the Garda Financial Intelligence Unit and the Criminal Assets Bureau figh t financial crime  here.

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