Montenegro

Practical Implementation of the Law on Prevention of Money Laundering and the Financing of Terrorism: innovations and challenges

“By adopting the new Law on Prevention of Money Laundering and Financing of Terrorism last year, Montenegro sent a clear message that we wish to implement the best practices, experiences and standards in the areas obligatory for the EU member countries, but also in those which express aspirations for accession,” H.E. Igor Lukšić, Minister of Finance in the Government of Montenegro said.

Minister Lukšić pointed out that they are aware of the need to balance the policy of strengthening supervision by fortification of authorised institutions and the policy of increasing the economic competitiveness through implementing stimulating tax policies, investing in infrastructure, reforms of labour market and other segments. “By strengthening these institutions,” Minister Lukšić thinks, “we are sending a message of stability and safe investing in our economic system.”

“Those not well-intentioned would not miss a chance to polemicize about a small number of verdicts which went into effect in Montenegro in relation to this type of criminal act. Also, it is avoided to correctly explain that it is about one very sophisticated and hard to prove criminal act,” said Minister Lukšić adding also data from Supreme State Prosecution about the ongoing Montenegrin judiciary proceedings against 33 persons for money laundering. “Meetings such as the one today are not the occasion to prejudice the epilogue of those proceedings,” said Minister Lukšić. He also supported the work of judiciary and expressed hope that there will be more verdicts to go into effect soon. “This is the best and the only way to strengthen the institutions, which would result not only in better positioned negotiations with the EU, but also the reports from relevant international organisations will statistically be more favourable for Montenegro,” Minister Lukšić emphasized. He also reminded that the Government of Montenegro established a special National Commission in charge of supervising the implementation of Action Plan on Fight against Corruption and Organised Crime. In this context, the Montenegrin Agency for Money Laundering Prevention has a very successful cooperation and partnership with financial intelligence service through EGMONT group affairs which member the Agency is,” Minister Lukšić said.

Predrag Mitrović, MA, Director of AMLP in the Government of Montenegro said that the enforcing of the Law on Prevention of Money Laundering and Financing of Terrorism created a precondition for full realisation of all the measures from the Action Plan on Fight against Corruption and Organised Crime.

According to Mr. Mitrović, six fraudulent transactions were reported as of early of this year, which refer to seven natural persons - i.e. to the amount of € 10.75 million. “The number of reported cash transactions is 4.54% larger in relation to the same period last year, while the number of non-cash transactions reported by obligors is 16% larger. As of January 1st 42 cases were opened in the Analytics Department, and 19 more in the Fraudulent Transactions Sector,” Mr. Mitrovic stated.

UNDP Resident Representative a.i./ UN Interagency Focal Point in Montenegro Mr. Garret Tankosić Kelly said that the UNDP strongly supports the fight against money laundering and that the AMLP is their key partner in this regard. “We wish to emphasize our support to the implementation of National Action Plan against Corruption and Organized crime and to promote the new legislation on prevention of money laundering. A far reaching objective is to increase the dialogue on important social issues related to the fight against corruption and organized crime. The issue of prevention of money laundering is clearly mentioned in the EC Progress Report, where it is stated that preparations on the fight against money laundering are at a very early stage and not very advanced. To give you a rough ballpark of what that might look like in Montenegro, the US State Department and the IMF approximate the size of money laundering up to 3 - 5% of GDP, whereas the Montenegrin 2007 GDP is estimated to 2.2 billion EUR,” said Mr. Tankosić Kelly.

Mr. Tankosić Kelly also listed the important aspects of the new Law:

The first refers to creation of adequate legislative framework. In this sense, the new Law provides:

• Clear definition of the commitments of financial institutions, since they are in the front row in the fight against Money Laundering. On the other side the law still does not provide criminal liability for their failure to comply with the provisions of the law.
• Enhanced verification of the financial transactions done by the persons with public political profiles as well as their immediate family members and natural persons with a common profit from the asset and/or other type of close business contacts.

Second aspect is related to the successful functioning of Money Laundering Prevention system. It depends on two components:

• Legislative framework must be in compliance with the best international standards and aside the Law on prevention of money laundering, implementation of Criminal Legislation is a key complementary component. In this regard, we are carefully observing the ongoing process of amendments to the criminal legislation, which should introduce into the Montenegrin legal system the criminal asset recovery and shifting the burden of proof to the suspects.

• On the other side, the interaction between key Governmental ministries and agencies must be efficient and based upon clear indicators for measurement of progress as well as division of responsibilities, within the organizational framework of Agency, Police, Prosecution and Judiciary. If only one of these four pillars fails to produce quality results, the entire system is jeopardized. And this is firmly reflected in general perception of the public opinion.

 

“In this regard, we are expanding the domain of our work to the judiciary and prosecution, with constant reference to the need for the improved coordination between various stakeholders,” concluded Mr. Tankosić Kelly.

Verification of Implementation of the Law in September

“The Montenegrin law is more coordinated with the international directives than certain ones of developed European countries. But, the question is how it is being implemented,” said Mr. Claudio Stroligo, World Bank expert. He announced that an evaluation of the implementation of the Law in Montenegro by international organisations would take place in September. Mr. Stroligo also added that the methodology to be applied during the evaluation contains 200 parameters which are equal for each country.

 

 

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