EU moves in the right direction with new rules against money laundering but stumbles on trusts

Brussels, 15 DECEMBER 2017. Today the European Parliament and the EU Member States reached a political deal on new anti-money laundering rules. These will strengthen the fight against corruption and terrorist financing in the EU and third countries by making public who owns and controls EU companies. However, The ONE Campaign, which alongside organisations like Transparency International, Global Witness and Eurodad, has long been calling on EU governments to adopt new rules that would shine a light on secretive structures that can undermine the futures of millions of people living in poverty, is concerned that the deal leaves a major loophole.

Emily Wigens, interim Brussels Director at ONE, said:

“Today’s agreement marks substantial progress in the fight against corruption, money laundering, and terrorist financing. The European Union has shown leadership in tackling anonymous companies, which play a key role in facilitating billions of Euros worth of illicit financial flows out of developing countries each year. Making public who owns and controls EU companies will allow citizens, journalists and authorities in the EU and beyond to follow the money and root out corruption.

However, the new rules contain a major loophole which will allow criminals and the corrupt to hide behind secretive trust structures. The European Parliament has twice called for these loopholes to be closed, and twice Member States have rejected such measures. The secrecy surrounding the ownership of trusts helps siphon vital revenues out of developing countries that, if taxed, could be used to finance the fight against extreme poverty.

We now call on EU Member States to take urgent action to close this loophole by making public who is behind opaque trust structures when implementing this legislation.”

ENDS

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