money laundering best practices, lessons to be learnt and steps

Additional improvement of the Law lies in the expansion of this list to lawyers and lawyers’associations, public notaries, audit companies, authorized auditors, authorized accountants andtax advisors. It should be mentioned at this stage that lawyers, lawyers’ association and publicnotaries are obliged to report on suspicious transactions to the Office on Prevention of MoneyLaundering only in the case when they are performing financial or property transactions 11 .The Law forbids opening and possession of anonymous accounts. It is mandatory to establish theidentity of the client when opening any kind of bank account or: At each transaction made in cash, foreign currency, shares, precious metals or gems incases when total value of transaction exceeds HRK 105.000, When performing linked financial transactions that in total amount value of HRK 105.000or more, Insurance companies are obliged to identify customer on matters of life insurances if thetotal annual amount of premium exceeds HRK 40.000, At all other cash or property transactions where a suspicion of money laundering exists.Additional change in the Law is that when establishing a business relationship of a morepermanent nature, the party has to provide a statement specifying the owner of the legal personand list of the Executive Board in order to establish the identity of the real owner.In year 2005 in Croatia there were 282 cases of Money Laundering amounting to suspected“laundering” of 100 million EUR or 740 million HRK. Additionally there were 4.2 million HRKof suspicious transactions blocked by banks, and 70 cases were reported to the competentauthorities. For the last 9 years of existence of the Office for Prevention of Money Launderingthere have been 2 omnipotent sentences for Money Laundering.The Office, in cooperation with some foreign Offices, was also involved in discovering a part ofthe chain of international mafia wanted by Interpol, in which transactions amounted to 13.5million dollars.Up to 2 million dollars were transferred through non resident bank accounts of anoff-shore company, 5 million euros in the case of additional capitalization of the financialinstitutions by the foreign investors, 2.5 million dollars from drugs trafficking and 4 milliondollars from cigarette smuggling. Additionally, five bank accounts of suspected terrorists werefrozen by the office.11Art 9a of the Law on Prevention of Money LaunderingMoney Laundering Best Practices,Lessons to be Learnt in the Balkan RegionWritten by Tamara BrneticPage 13 of 58