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Measures to combat money laundering

Money laundering is the process by which those engaging in criminal activity conceal the illegal origin of the resulting property or income.

Better cooperation between Member States, and in particular their customs authorities, is one of the aims pursued in the efforts to prevent money laundering. Such efforts within the Union are governed by the Treaty on the Functioning of the European Union (TFEU) and are of two types:

  • under Title IV (capital and payments), free movement of capital is so regulated that the flows can be monitored. These rules relate both to financial operators, such as credit institutions and other financial organisations, and to means of conducting financial transactions, especially across borders. They also target the use of the financial system for money-laundering purposes;
  • under Title V (police and judicial cooperation in criminal matters), action to combat money laundering is seen primarily as part of the battle against organised crime and terrorism. The focus is on defining offences and on strengthening mutual assistance.

In relation to police and judicial cooperation in criminal matters, efforts to combat money laundering rest on multi-annual action programmes. The previous five-year programme adopted in 2004 in The Hague followed on from the 1999 Tampere programme. These efforts are now continued under the Stockholm Programme (2010-14) adopted in 2009.

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