Thursday, September 09, 2021
“Chaos in Financial Supervision”
Scholz comes under fire after the raid
Shortly before the general election, the public prosecutor’s office orders searches in the finance and justice ministries. The raid could come at an inopportune time for the SPD candidate for chancellor. The investigators ask why the Cologne money laundering unit under Scholz’s leadership hardly produces any suspicious transaction reports.
After raids in the Federal Ministry of Finance and the Federal Ministry of Justice in the course of an ongoing investigation against those responsible for the anti-money laundering unit Financial Intelligence Unit (FIU), the opposition used the searches for harsh attacks on Federal Finance Minister and SPD candidate for Chancellor Olaf Scholz. “Olaf Scholz drove the FIU to the wall with his eyesight,” said Green finance spokeswoman Lisa Paus and domestic policy spokeswoman Irene Mihalic. “Under Scholz, the technical supervision does not seem to work.” The integrity of the fight against money laundering in Germany is in question and thus an important part of the fight against organized crime and terrorism. We now need comprehensive clarification of these processes regardless of offices and positions, “demanded the Green politicians.
The financial policy spokesman for the FDP parliamentary group, Florian Toncar, called it “a probably unique process” that the public prosecutor’s office was searching the Federal Ministry of Finance and Justice. “If the allegations of thwarting punishment in the office against those responsible for the Financial Intelligence Unit are confirmed, it is a real scandal.” It is already clear that after years under Scholz, the FIU is in a bad state, “because he treated her like a stepchild”.
Left parliamentary group deputy Fabio De Masi said that he had asked Scholz since 2018 to end the chaos at the FIU. “This is a security risk for Germany.” At Wirecard, too, the FIU was responsible for preventing punishment. “If you want to lead Germany, you have to get customs on the line,” said De Masi.
“Extensive communication with ministries”
“In the proceedings of the Osnabrück public prosecutor’s office for thwarting criminal offenses against those responsible at the FIU, officials from the Central Criminal Inspectorate Osnabrück and the Osnabrück public prosecutor’s office searched the offices of the Federal Ministry of Finance and the Federal Ministry of Justice and Consumer Protection today,” the public prosecutor said at noon Press release with.
An evaluation of documents that had been secured during previous raids in the Federal Customs Administration showed that there was extensive communication between the FIU and the ministries now searched. According to its own information, the public prosecutor’s office now wants to investigate in particular whether and, if so, to what extent the management and those responsible in the ministries were involved in the decisions of the FIU. The evaluation of the documents will take several weeks.
Suspicious transaction report not forwarded
The starting point of the investigation was therefore a suspicious transaction report by a bank to the FIU in June 2018 about payments to Africa of more than one million euros, “whereby the bank suspected that the background of the payments was arms and drug trafficking as well as terrorist financing”. The FIU took note of this report, but did not forward it to German law enforcement authorities, so that there was no longer any possibility of stopping the payments. The investigators also investigated the question “why the number of suspicious transaction reports has fallen to a fraction since the FIU took over the money laundering control”.
The Ministry of Finance underlined that the public prosecutor’s office was primarily concerned with the identification of employees of the FIU central office in Cologne and with information on the extent to which the so-called risk-based approach of the central office had been legally discussed and secured. By processing the suspicious transaction reports in a risk-oriented manner, the central office sets priorities in the analysis of these suspicious transaction reports. “The central office subjects every incoming report to an initial assessment and submits reports that correspond to at least one of the – currently ten – risk focuses to an in-depth manual analysis.”
Responsibility for the FIU had been shifted from the Federal Criminal Police Office to customs in the last legislative period by a decision by the then Federal Finance Minister Wolfgang Schäuble. “This has led to discussions in the professional community,” said the ministry. Since taking over official duties, Scholz has ensured that the FIU has been strengthened through additional staff, expanded competencies and technical improvements. The head of the central office was also replaced in 2018. The workforce of the FIU has been increased from an initial 165 to 469 employees.
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