With just 2% of proceeds of crime being frozen, MEPs rush to plug the gap

New rules to freeze and confiscate the proceeds of crime and strengthen the powers of asset recovery offices

File photo
File photo

New rules voted by on MEPs will strengthen the powers of asset recovery offices (ARO) to get swift access to information including real estate, citizenship, and commercial registries, including fiscal and securities data, in the fight against crime.

The new rules now include beneficial ownership registries and centralised bank account registries in the scope of ARO direct access.

In 2010–2014, only 2.2% of the proceeds of crime were frozen in the EU, and only 1.1% of these proceeds were confiscated. In December 2021, the European Parliament called for the EU’s regime on asset recovery and confiscation to be harmonised, and in the EU Strategy to tackle Organised Crime (2021-2025), the Commission proposed strengthening these rules.

The new law allows for immediate freezing measures to ensure that suspected criminal assets do not go missing during investigations. For their confiscation, the law introduces two new forms: non-conviction based confiscation, and confiscation of unexplained wealth, when it is uncovered during a criminal investigation and a court believes it is connected to criminal activity.

Victims will be fully taken into account within the asset tracing, freezing and confiscation proceedings, prioritizing restitution to victims and ensuring their compensation.

In parallel, MEPs have also agreed new rules to criminalise the violations of EU sanctions consistently.

The new legislation on seizing criminal assets was adopted with 598 votes in favour, 19 against, and 7 abstentions.

The new directive now covers a wider range of crimes committed within the framework of a criminal organisation, such as trafficking in human beings, drugs or firearms, sexual exploitation of children, and money-laundering.

The law would also crack down on cases where confiscation is evaded with the help of a third person, and allow confiscation in certain cases where conviction is not possible, for example in cases of illness or death of a suspect. To prevent assets from degrading, member states would have to set up dedicated offices to manage confiscated assets, and tools to manage information related to them, for example central registries.

“An effective confiscation framework of assets deriving from criminal activity serves as a proactive and impactful strategy in the fight against organized crime, targeting its core motivation – financial gain,” said Romanina rapporteur Loránt Vincze (EPP).

“We managed to take a great step in this regard: the law strengthens the capabilities of competent authorities to identify, freeze, confiscate and manage assets through improved access to relevant databases, better and faster information-sharing among competent authorities, and the introduction of novel, more effective procedures to confiscate criminal assets.”

Ewropej Funded by the European Union

This article is part of a content series called Ewropej. This is a multi-newsroom initiative part-funded by the European Parliament to bring the work of the EP closer to the citizens of Malta and keep them informed about matters that affect their daily lives. This article reflects only the author’s view. The action was co-financed by the European Union in the frame of the European Parliament's grant programme in the field of communication. The European Parliament was not involved in its preparation and is, in no case, responsible for or bound by the information or opinions expressed in the context of this action. In accordance with applicable law, the authors, interviewed people, publishers or programme broadcasters are solely responsible. The European Parliament can also not be held liable for direct or indirect damage that may result from the implementation of the action.

More in Ewropej 2024