Assessing the effectiveness of the EU AML regime: Detecting and investigating cases of trafficking in human beings
| Published date | 01 December 2018 |
| DOI | 10.1177/2032284418812225 |
| Date | 01 December 2018 |
| Subject Matter | Articles |
Article
Assessing the effectiveness
of the EU AML regime:
Detecting and investigating
cases of trafficking
in human beings
Þorbjo
¨rg Sveinsd ´
ottir
The University of Edinburgh, Iceland
Abstract
The effectiveness of anti-money-laundering (AML) mechanisms within the European Union (EU), in
the context of the detection and investigation of trafficking in human beings (THB), is the focal
point of this article. The article begins by examining the EU’s emphasis on proactive financial
investigations in cases of THB and then moves on to examine EU AML framework. Special
attention is paid to the 4th AML Directive (Directive (EU) 2015/849), the Second Transfer of Funds
Regulation (Regulation (EU) 2015/847), the Second Payment Services Directive (Directive (EU)
2015/2366) and the Cash Control Regulation (Regulation (EC) 1889/2005). The modus operandi of
traffickers operating within the EU when laundering the proceeds of their crimes is then studied,
with the view of assessing the effectiveness of the framework. The analysis shows that the EU AML
framework fails to capture some common modes of money laundering (ML) in THB cases and in
addition, it is less effective when the criminal proceeds are laundered within the EU. The analysis
furthermore shows that the EU AML regime is largely dependent on the ML risk assessment of
private actors, many who do not comply with their AML obligations and are widely insufficiently
monitored within the Member States (MS). The article concludes that the limitations of the EU
AML framework and it’s enforcement in the MS have resulted in difficulties both in detecting ML
associated with THB and in gathering evidence during THB investigations.
Keywords
Anti-money-laundering, money l aundering, criminal proceeds, pro active financial investigation,
trafficking in human beings, human trafficking
Corresponding author:
Þorbjo
¨rg Sveinsd´
ottir, Bollagata 12, 105 Reykjav´
ık, Iceland.
E-mail: thorbjorg@hersak.is
New Journal of European Criminal Law
2018, Vol. 9(4) 464–485
ªThe Author(s) 2018
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DOI: 10.1177/2032284418812225
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Introduction
The European Union’s (EU’s) strategy on the fight against trafficking in human beings (THB)
adopts a three-tiered approach – an approach that is well established globally
1
with a focus on the
prevention of trafficking, the protection of victims and prosecution of traffickers.
2
The focus here
will be on the last element and in particular the EU’s emphasis on the importance of proactive
3
financial investigations as a means to increase successful prosecutions in THB cases. A financial
crime strategy as a way to fight organized crime is nothing new; there has been a growing emphasis
on financial investigations as a way to target the profits of organized crime both on a national and
supranational level for quite some time.
4
This approach has been central in the EU’s fight against
organized crime for at least two decades,
5
and the emphasis on a financial crime control approach
to organized crime in general, and THB in particular, is evident in numerous EU documents.
6
The
strategy revolves around removing the incentive for crime and is essentially based on ‘rational
choice theories of criminology’.
7
The two main tools widely recognized for effectively conducting financial crime control are
firstly, legal provisions that allow for the tracing, blocking and recovering of criminal assets, and
secondly, legal provisions that criminalize and tackle money laundering (ML)
8
which is, in
essence, an auxiliary crime created to implement a proactive financial crime control strategy.
9
The second group of legal provisions, concerning the auxiliary crime of ML, namely anti-money-
laundering (AML) mechanisms, has been formulated to facilitate the detection of criminal pro-
ceeds and to prevent criminals from laundering the proceeds of their crimes. AML mechanisms
thus serve as one of the main tools of detecting and tracing criminal proceeds, and on the basis of
the detection of possible ML through AML mechanisms, a proactive financial investigation may be
launched. Effective AML mechanisms should thus both enable the detection of THB-related ML
and facilitate evidence gathering during such an investigation.
AML mechanisms are, therefore, of considerable importance when it comes to the detection and
investigation of THB. This article will analyse the effectiveness of the EU AML regime, in
particular with regard to proactive financial investigations in cases of THB. The article will begin
by examining the EU’s THB strategy in connection to financial investigations and then move on to
1. Often referred to as the ‘three P’s approach’.
2. Report from the Commission to the European Parliament and the Council on the progress made in the fight against
trafficking in human beings (2016) as required under Article 20 of Directive 2011/36/EU on preventing and combating
trafficking in human beings and protecting its victims (COM (2016) 267 final), p. 3.
3. On proactive investigations in THB cases in general, see OSCE Resource Police Training Guide: Trafficking in Human
Beings, Vol. 12 (TNTD/SPMU, 2013), pp. 135–138; UNODC Toolkit to Combat Trafficking in Persons. Available at:
https://www.unodc.org/documents/human-trafficking/Toolkit-files/07-89375_Ebook[1].pdf (accessed 4 May 2018).
4. W.C. Gilmore, Dirty Money: The Evolution of International Measures to Counter Money Laundering and the Financing
of Terrorism. 3rd ed. (Strasbourg: Council of Europe, 2004), pp. 19–20.
5. M. Kilchling, ‘Finance-Oriented Strategies of Organized Crime Control’, in L. Paoli, ed., The Oxford Handbook of
Organized Crime (Oxford University Press), p. 4. Available at: http://www.oxfordhandbooks.com.ezproxy.is.ed.ac.uk/
view/10.1093/oxfordhb/9780199730445.001.0001/oxfordhb-9780199730445-e-006 (accessed 7 May 2018).
6. Brussels Declaration made at the European Conference on preventing and combating trafficking in human beings, global
challenge for the 21st Century, on 18 to 20 September 2002. Previous EU HT strategies have also touched upon the use
of financial investigations, Council Conclusions of 8 May 2003 (2003/C 137/01) section 4(iv).
7. Kilchling, ‘Finance-Oriented Strategies of Organized Crime Control’, p. 4.
8. Gilmore, Dirty money, p. 20.
9. Kilchling, ‘Finance-Oriented Strategies of Organized Crime Control’, p. 6.
Sveinsd´
ottir 465
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