Cross-border cash movements: tightening up anti-terror and crime checks
- New rules beefing up rules on cash controls dating back to 2005
- New definition of ”cash”
- Disclosure declaration required for cash sent by freight
Tougher checks on cash entering or leaving the EU were backed by the Civil Liberties and Economic Affairs committees on Monday.
The new rules repeal the First Cash Control Regulation (CCR) from 2005, which requires individuals to declare sums over €10,000 when leaving or entering the EU. MEPs want to close loopholes exploited by criminals, such as divergent penalties in different member states, travelling with sums just below the declaration threshold or using means of transferring value that are not covered by current rules.
To prevent the proceeds of crime from re-entering the economy or money being used to finance illegal activities, MEPs agreed to:
- widen the definition of ”cash” to include gold, precious stones and metals, as well as anonymous prepaid electronic cash cards,
- enable the authorities to impound cash below the €10,000 threshold temporarily, if criminal activity is suspected, and
- make it mandatory to disclose “unaccompanied” cash sent by cargo.
MEPs also asked the EU Commission to draft legislation to bring about a convergence of cash control penalties in the member states and study the possibility of establishing a Union Financial Intelligence Unit by 2019.
The draft law was adopted Monday evening by 55 votes to 3, with 4 abstentions.
Mady Delvaux (S&D, LU), co-rapporteur, said: “Large sums of cash, be it banknotes or gold bullion, are often used for criminal activities such as money laundering or terrorist financing. With this legislation, we give our authorities the tools they need to improve their fight against those crimes. The central point is their fast access to all the information they need for their investigations. We therefore ask their systems for data exchange to be interconnected and we repeat our call for an EU Financial Intelligence Unit.”
Co-rapporteur Juan Fernando López Aguilar (S&D, ES) said: “We have tried to strike the right balance between this instrument, which aims to strengthen, on the basis of internal market, the control of the cross-border cash passing through the external borders of the European Union, and protecting legitimate interests. So, making it proportional."
The text still needs to be approved by the Parliament as a whole, before MEPs can start negotiating the legislation with EU governments.
Currently, approximately 100,000 cash control declarations are made per year, which amounts to €60 to €70 billion. However, during the same period, about 11,000 infringements are detected, amounting to €300 million.
Member states report that ISIS terrorists frequently transport cash amounts below the €10.000 threshold (around €7.000) to avoid detection.
Despite the high risk posed by virtual currencies, such as Bitcoin, these are not included in the definition of “cash”. This is because customs authorities lack the resources to monitor them.