April 25, 2018
Europe is struggling to agree on how to tackle money laundering in the wake of high-profile scandals in the Baltic region. Latvia, grappling with the aftermath of its third-biggest bank being closed down, is calling for a pan-European approach to fighting dubious financial flows. While it has the support of other small states, it hasn’t convinced Germany, which argues those powers are better kept at a national level.
Peters Putnins, head of Latvia’s Financial and Capital Market Commission, says no small European country could replicate the U.S. resources that exposed wrongdoing at the now-defunct ABLV Bank AS in February. He didn’t name the smaller nations that back Latvia’s stance.
A lack of cooperation and information exchange between countries has limited Europe’s efforts to prevent illicit capital flows. Europol estimates that just 1 percent of about 120 billion euros ($145 billion) that are laundered annually in the EU are detected and recovered. Daniele Nouy, head of banking supervision at the European Central Bank, wants greater international coordination to boost detection.