Today, Sir Julian King will appear before the European Parliament’s Civil Liberties, Justice and Home Affairs (LIBE) Committee in Strasbourg. Sir Julian has been put forward as the UK’s EU Commissioner for Security Union. This newly created portfolio will be dealing with some of the areas of particular interest to us at Transparency International EU. So to help MEPs sitting on the committee who may be searching for questions to ask Sir Julian we have some suggestions:
Shell companies and trusts can be abused for outright criminal activities, like money laundering and terrorism financing, threatening as such the security of the EU. For trusts in particular, a 2007 European Commission report concluded that these are at “very high risk of exploitation” for money laundering in the EU. Opacity around the beneficiaries of complex schemes involving trusts makes the investigators’ and prosecutors’ task of proving their role in the crime particularly difficult and consequently, their use in criminal activities tends to go under-reported. This and cases like the Panama Papers demonstrates the dire need for more transparency on trusts and in particular on the identity of those pulling the string behind the scene.
Do you support the public disclosure of beneficial ownership information for all types of trusts as an appropriate measure to prevent and detect criminal activities and increase EU security? Will you be supporting this provision as part of the negotiations for the revision of the 4th Anti-Money Laundering Directive?
Corruption is a major threat to European security by, among other things, facilitating the infiltration of organised crime groups in politics and business. The European Commission has made a number of recommendations to Member States on how to improve their anti-corruption efforts, in the 2014 EU Anti-Corruption report and as part of the European Semester. As the Parliament’s own research has shown, this advice is largely ignored by the Member States. For example, in 2013, Bulgaria did not comply with a single recommendation. In view of the 2016 EU Anti-Corruption report to be published this year, what suggestions does Sir Julian have for improving this track record?