Friday, October 30, 2020

German law targets money laundering in property market


Germany’s government is unveiling a new law aimed at combating money laundering in the real estate sector. It’s estimated that billions in illegal earnings are funneled into the German property market each year.

German Finance Minister Olaf Scholz said the draft bill will bring Germany in line with “the highest international standards in the fight against money laundering.”

The law was approved by Chancellor Angela Merkel’s Cabinet on Wednesday. Among other changes, it will give the government’s Financial Intelligence Unit (FIU) greater powers and access to the data of other investigative authorities.

“Money laundering is a serious problem in our country. We have to eliminate it,” Scholz told the Funke Media Group in an interview. “In particular, we have to take a closer look at the real estate market.”

- Advertisement -

The legislation will expand the number of professional groups required to report suspicious deals and take precautions to prevent laundering. Staff at auction houses, precious metals dealers, and real estate agents will now be covered by the law.

Germany a ‘gangster’s paradise’

Scholz acknowledged that Germany had “some catching up to do” to tackle money laundering but said the FIU was becoming “more powerful.”

The opposition Green Party’s Lisa Paus accused the government of being too slow to act: “The minister of finance has finally admitted errors in the fight against money laundering,” she said, adding, however, that “a functioning money laundering defense is still a long way off.”

- Advertisement -

Read MoreGermany overhauls chaotic anti-money-laundering unit

She said tenants were ultimately losing out because dirty money was making prices in the property market rise.

Fabio De Masi of the Left Party called for a comprehensive real estate register to improve transparency. He said the government’s plan was a start but didn’t go nearly far enough.

“Germany is a gangster’s paradise and needs a real money laundering master plan,” he said.

In its 2018 annual report, the FIU noted an “extreme vulnerability” in Germany’s real estate market when it came to dubious business deals and the investigation of criminal activities. The FIU found that of the 77,252 cases of money laundering in Germany last year, about 3,800 involved the real estate sector.

According to anti-corruption group Transparency International, 15-30% of all proceeds from criminal activities are invested in real estate, either through building and renovating, or buying, selling and renting.

In a report last year, the organization called on Germany to implement reforms after finding that about €30 billion ($34 billion) of illicit funds were funneled into German real estate in 2017. It said criminal networks, particularly the Italian Mafia, had managed to exploit legal loopholes to launder money through properties in Germany.


Ukraine’s court strips critical power from anti-corruption agency

Ukraine's Constitutional Court has stripped the country’s anti-corruption agency of some of its critical powers. The high court’s ruling published on October 28 declared it...

Former South Korean President Lee Myung-bak sent back to prison for 17 years in corruption case

Former South Korean president Lee Myung-bak was ordered back to prison on Thursday (Oct 29) as the country's Supreme Court upheld a 17-year jail...

Nigerian court declines to issue international arrest warrant for fugitive ex-Petroleum Minister in corruption case

The Abuja Division of the Federal High Court, on Wednesday, refused an application by the Economic and Financial Crimes Commission, EFCC, for an arrest...

South Korea’s former Vice Justice Minister sentenced to jail for bribery and sexual favors

Former Vice Justice Minister Kim Hak-eui, the figure at the center of one of Korea’s biggest political sex scandals, was placed under pretrial detention...

Beam Suntory Inc. fined $19.6 million in foreign bribery case

Beam Suntory Inc. (Beam), a Chicago-based company that produces and sells distilled beverages, has agreed to pay a criminal monetary penalty of $19,572,885 to...

Subscribe For More

Get our daily notification on the latest financial crimes news around the World


Latest News

This Week

Former South Korean President Lee Myung-bak sent back to prison for 17 years in corruption case

Former South Korean president Lee Myung-bak was ordered back to prison on Thursday (Oct 29) as the country's Supreme Court upheld a 17-year jail...

Taiwan’s UMC fined $60m for theft of trade secret to help Chinese chipmaker

Taiwan’s UMC has pleaded guilty to trade secret theft in the United States and will pay a $60 million fine in a case where...

Spanish police arrests operator of Crypto Arbitrage firm Arbistar on fraud charges

The CEO of Arbistar the Spanish investment company, Santiago Fuentes, has been arrested and arraigned on charges of fraud, belonging to a criminal organization...

Philippines’ President Duterte orders corruption probe across government agencies

Philippine President Rodrigo Duterte said on Tuesday he had ordered the justice ministry to launch a sweeping investigation into graft across all government agencies,...

Adblock Detected!

Our website is made possible by displaying online advertisements to our visitors. Please consider supporting us by whitelisting our website.

Enable Notifications    Ok No thanks