Together with Transparency International (TI) colleagues across Europe, TI Ireland has over recent months been working to understand the main challenges for law enforcement investigations into cross-border corruption and money laundering. As part of these efforts, TI has published an article, One click away? The barriers investigators face across the EU when tracing asset ownership, which examines how effectively law enforcement agencies and financial intelligence units across nine EU countries can access information on the ownership of companies, trusts and high-value assets.
Drawing on surveys, interviews and desk research in France, Germany, Ireland, Italy, Latvia, Lithuania, Portugal, Slovenia and Spain, the article identifies and assesses current barriers facing investigators, as well as exploring how recent reforms (including the EU’s most recent anti-money laundering package) aim to address these challenges. Key findings include:
- EU rules require the registration of corporate structures and various high-value assets, the collection of data on who owns and controls many of these structures and assets (known as ‘beneficial ownership’), and direct access to this information for relevant authorities, including law enforcement.
- In practice, though, there are many challenges: ownership and asset registers are disconnected; data is often not machine-readable; access to some registers is mediated through clunky, case-by-case requests; cross-border interconnections are slow; data protection constraints (including interpretations of GDPR) hamper access and the ability to conduct proactive investigations.
- Some good practices exist (e.g. bulk data access to real estate and motor vehicle registers in certain countries) but many gaps remain – especially in the case of aircraft, yachts and crypto-assets – and the process to integrate data across jurisdictions has been slow.
In Ireland’s case, outstanding barriers include:
- Gardaí and the FIU not having direct access to beneficial ownership information on ‘certain financial vehicles’ (notably investment fund structures) but instead having to submit individual requests by email.
- Uniquely among the nine countries, Ireland has three separate beneficial ownership registers, each of which is managed by a different state agency with different modes of access, which can delay investigations.
- An out-of-date and fragmented system of 13 separate, paper-based ship registers for each of Ireland’s official ports, which as well as being inefficient contains no provision for verifying information submitted to registrars.
This article was published as part of TI’s Strengthened Enforcement Capacities of Public Authorities (‘STEP-EU’) project, which is funded by the European Commission via the EU’s Internal Security Fund. TI Ireland’s participation in the STEP-EU project is part of our ongoing and collaborative efforts to tackle dirty money flows via Ireland.