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Germany's State Secretary of the Ministry of Economic Affairs promised that the country has "big plans" to combat organized crime and money laundering.
The new "Second Sanctions Enforcement Act" (SDG II), passed last week, was a "milestone" and a "major step" against financial crime, according to former MEP Sven Giegold, who took his new position early this year.
In a press release, Mr. Giegold emphasized that "Only months ago, such a plethora of comprehensive regulations would have been unthinkable."
"This is also an important signal to our international and European partners, who have rightly criticised Germany for a long time for being too lax in dealing with financial crime," he continued.
The Federal Cabinet approved the draft SDG II last week, and according to the former MEP, it contains "urgently needed structural reforms."
The amendments aim to "strengthen the state and law enforcement" in the fight against financial crime and promise to "better enforce" sanctions imposed against Russian actors connected to the war in Ukraine.
"This issue has accompanied me politically for more than 20 years now, so this was a success for me," according to Mr. Giegold.
"In just a few months, in the Federal Government we have succeeded in doing what I fought for in the European Parliament for years," he continued.
The Central Office for Sanctions Enforcement (ZfS), which is presently housed in the Customs Department, will be established under the SDG II, and in the long run, it will be housed at a new, higher federal authority that will be established to deal with dirty money.
The proposed law also includes provisions for real estate data to be made available for a transparency register, while the ZfS also establishes a central register that will include assets that cannot be properly assigned.
The purchase of real estate using cash, cryptocurrency, or gold will be prohibited under the latest recommendations.
According to Mr. Giegold, these measures will "ffinally close a long known, gaping loophole for money laundering."
"We have big plans in the fight against money laundering and organised financial crime, much has been achieved with SDG II, but far from everything that would be necessary," he said.
"That is why we, as the Federal Government, are currently forging further measures to effectively combat money laundering and organised crime. We are committed to these in the course of sending the law to the Bundestag and the federal states. These include, in particular, measures to better identify beneficial owners who have so far been able to use a web of opacity and loopholes to conceal their identity," according to Mr. Gielgold.
The construction of a fully digital real estate transaction database, the linking of existing registers to close gaps, and the definition of "non-determinable beneficial owners" are a few of these.
He highlighted that the Federal Government will "continue to work together" to present new suggestions in order to address the shortcomings noted by the Financial Action Task Force, but he also acknowledged that there was "still a lot of room for improvement" in Germany's AFC efforts.
By fLEXI tEAM