Bosnia and Herzegovina is counting down the days until the next Moneyval inspection, which will determine whether we will return to the “grey list” of countries with insufficiently effective anti-money laundering measures. The new inspection will be in February of next year, and Moneyval has already warned us about serious shortcomings in the implementation of the law.
In December last year, the Committee of Experts for the Evaluation of Measures Against Money Laundering and Terrorism Financing of the Council of Europe, the so-called Moneyval, determined that Bosnia and Herzegovina has a number of shortcomings in these areas. The shortcomings should be corrected by February of next year. Out of the 70 or so recommendations, 75 percent of them need to be fulfilled in order to avoid being put back on the “Grey List” of countries when it comes to money laundering and terrorist financing.
It is necessary for BiH to adopt the Law on Confiscation and Management of Assets at the State Level and the Law on Targeted Financial Sanctions in Relation to Terrorism, Terrorist Financing and the Proliferation of Weapons of Mass Destruction as a matter of priority. The establishment of a register of beneficial owners of legal entities in Bosnia and Herzegovina has been awaited for a long time, which is another important requirement of the EU and FATF, and which is assessed by Moneyval, and the competent institutions must urgently resolve it.
There is a lot of work to do, and little time. There is no lack of optimism for a positive outcome.
“What would be a priority, given that we were the worst in the Report, is the Law on Targeted Financial Measures of the UN against Terrorism and the Financing of Terrorism, and the Financing of Proliferation. We will see if we succeed. The Ministry of Security has drafted this law. We will send it for opinion next week. We will put it into the procedure. We hope that it will be adopted there by February,” says Edin Jahić, member of the Delegation for “Moneyval”.
A possible return to the “Grey List” would have a number of negative effects. If someone was thinking of investing in BiH, it would convince them not to do so. For our businessmen, in addition to taking longer, all transactions abroad would also be more expensive. The consequences would not bypass ordinary citizens either.
“It would be impossible to pay for some international services. Likewise, some transfers of our people living abroad, money transfers that go through certain platforms that are used to send money, might be prohibited. They would also be more complicated and expensive. So citizens would certainly feel some consequences,” points out Saša Grabovac, president of the Association of Economists “SWOT”.
Money laundering in BiH is monitored by numerous institutions at all levels of government, but the key institution in the fight against financial crime is SIPA, more precisely its Financial Intelligence Department. There is no data for this year, but last year there was an increase in both the number of suspicious transactions and their value.
The Financial Intelligence Department of the State Investigation and Protection Agency received 1,279 reports of suspicious transactions, the total value of which is 298 million convertible marks, which is an increase of 30 million BAM. In 63 percent of cases, suspicion of the existence of a criminal offense was confirmed. 11 reports with reasonable suspicion of money laundering and related criminal acts were forwarded to the prosecutors’ offices in BiH, and they included 43 individuals and 12 legal entities.
Economist Zoran Pavlović believes that Bosnia and Herzegovina has perhaps the most rigorous money laundering controls, but when it comes to individuals, that is, ordinary citizens.
“We have established an incredibly strict system of working with money for ordinary people and people, while obviously for some large transactions these rules do not apply, and large transactions are precisely those people, those companies, those transactions that are essentially suspicious,” emphasizes Pavlović.
Moneyval, the Committee of Experts of the Council of Europe, is a permanent body that assesses how adequate and in line with international standards a country’s system for preventing money laundering is. They say that we are not the worst, but that we have a lot to improve and improve. Of course, they have set a deadline for that.
