Finland is planning to establish its first "wall of shame" for companies and other so-called "reporting entities" that have not taken the necessary steps to prevent money laundering in line with the 2017 Anti-Money Laundering Act.
The list would for example include automobile dealers or real estate brokers who have not fulfilled the obligations of the law, which include doing due diligence on their customers and providing appropriate employee training on the subject. For instance, the new law requires business owners to check the identity of anyone making a purchase worth more than 10,000 euros.
An investigation into company negligence in this area is almost finished, and state authorities are expected to levy their first administrative fines and penalty payments by the end of the year. A prerequisite for all the sanctions is that the violation or neglect was either intentional or the result of negligence.
"The law isn't credible if the reporting entities don't take care of the basics," says chief inspector Vesa Härmälä of Southern Finland's Regional State Administrative Agency (AVI).
FATF raps Finland over enforcement
The inter-governmental Financial Action Task Force, formed in 1989 to combat money laundering and terrorist financing, criticised Finland in the spring for failing to impose punishments that would promote enforcement of the new law. The public list is a response to this criticism.
Finland's Financial Supervision Authority, the Police Lottery Authority, the National Board of Patents and Registration, and the Finnish Bar Association will join the AVI units in supervising compliance.
"Companies that neglect to monitor their customers and evaluate the associated risks will be made subject to public reproach, which is more effective than being charged in an isolated money laundering case," says Pirjo Jukarainen, a researcher at the Police University College.
Very few money laundering cases are ever tried in a court of law, yet it is feared that the illegal practice is growing in Finland, especially in the real estate market.
Helsinki's District Court recently dismissed all charges in a case that would have been Finland's largest in history, as there were insufficient grounds to establish the criminal origin of the money in question.
Better enforcement of the Anti-Money Laundering Act is hoped to make it easier to crack down on these kinds of offenses.