12° Nicosia,
27 May, 2024

Combatting money laundering: Insights from Katerina Sikioti Charalambaki

Urgent need for rapid implementation of EU directives to combat organized crime

Andreas Karamitas

Money laundering poses a significant threat to the EU's economy and society, with organized crime generating revenues of at least €139 billion annually, as emphasized by Katerina Sikioti Charalambaki, a professor and lawyer at the High Court of Justice. Discussing the issue at a recent workshop at the University of FREDERICK, Charalambaki underscores the necessity for rapid incorporation of relevant EU directives into domestic law and their consistent implementation to combat this issue effectively.

Q: What is the scale of the problem of money laundering in the EU and why is it considered important?
A: Money laundering in the EU poses a major threat due to the large revenues generated by organized crime, amounting to at least EUR 139 billion per year. These illicit proceeds are often 'legalized' through an underground financial system, undermining the rule of law and fundamental human rights. Cross-border organized crime, driven by financial gain, further exacerbates the issue.

Q: What is self-laundering and how can it be tackled?
A: Self-laundering occurs when the perpetrator of money laundering is also the perpetrator of the underlying crime. Recent developments in guidelines and case law allow for double punishment in such cases, resolving previous reservations.

Q: Cyprus has for years had a reputation as a money laundering state. How can Cyprus change this reputation?
A: Cyprus can only change this reputation by swiftly incorporating relevant EU directives into domestic law and consistently implementing them.

Q: Can the Cypriot legal system shield the economy from money laundering issues?
A: The current legal framework provides a fairly satisfactory shield against money laundering issues in the Cypriot economy.

Q: How can Cyprus assist the EU's efforts to combat illicit proceeds of crime?
A: Cyprus can assist by ensuring the proper functioning of domestic services and cooperating unhindered with competent EU institutions.

Discussing the involvement of lawyers in money laundering issues, Charalambaki highlights the importance of attorney-client privilege while acknowledging lawyers' obligation to report suspicious transactions. In Greece and Cyprus, lawyers are obliged to report suspicions of suspicious transactions to designated authorities, ensuring compliance with legal obligations.

Addressing the latest developments at the European level, Charalambaki mentions Directive (EU) 2024/1260 aimed at asset recovery and confiscation following criminal activities. She emphasizes the need to address possible violations of fundamental human rights and ensure safeguards and means of redress to protect individuals' rights.

Critiquing the new directive, Charalambaki points out concerns regarding the inclusion of indirect benefits of criminal acts in the concept of 'proceeds of crime' and issues related to confiscation not based on conviction. Despite criticisms, the directive aims to make money laundering an independent crime and introduces measures for effective asset management.

In conclusion, Charalambaki's insights highlight the evolving nature of money laundering legislation and the importance of effective measures to combat this financial crime.

[This article was translated from its Greek original and edited for clarity and brevity]


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