1. Policy developments in the area of anti-money laundering and countering financing of terrorism, and related data needs
I will speak today about the needs on statistical data from an anti-money laundering/countering financing of terrorism perspective based on mainly the new 5th Anti-money laundering directive (the updated 4th AML/CFT Directive): Articles 7 and 44.
First of all I would like to say that there has been an agreement on updating the 4th AMLD, which is now called the 5th AMLD. The text is now scrutinezed by the lawyer linguists and is probably being published in the Official Journal in the beginning of Jine.
As regards statististics there have been some changes, which I will talk about in a few minutes.
European Commission, DG Justice and Consumers:
JUST.B3 (Financial crime) and
JUST.C1 (Justice policy and rule of law)
JUST

2. The need to develop statistics on money laundering in general - I
The need to develop statistics on crime and criminal justice in general;
The need to develop statistiscs on money laundering
The need to develop statistics on crime and criminal justice in order to measure trends and better assessing risks has long been recognised by different organisations, such as the United Nations and the European Union and its Member States.
However, the statistics that were developed between 1980 and 2010 do not contain any data of specific interest for money laundering.
In the Hague Programme (2005), outlining developments for the next five years in the area of freedom, security and justice, the European Council welcomed "the initiative of the Commission to establish European instruments for collecting, analysing and comparing information on crime and victimisation and their respective trends in Member States, using national statistics and other sources of information as agreed indicators. Eurostat should be tasked with the definition of such data and its collection from the Member States.“

3. The need to develop statistics on money laundering in general - II
The Stockholm programme (2010)
Further development of crime statistics (including money laundering) took place within the context of the Stockholm programme (2010). In a specific chapter on statistics the European Council considered that "[a]dequate, reliable and comparable statistics (both over time and between Member States and regions) are a necessary prerequisite, inter alia, for evidence-based decisions on the need for action, on the implementation of decisions and on the effectiveness of action." The European Council therefore invited the Commission to: "- continue developing statistical tools to measure crime and criminal activities and reflect on how to further develop, after 2010, the actions outlined and partly implemented in the Union Action plan for on developing a comprehensive and coherent Union strategy to measure crime and criminal justice, in view of the increased need for such statistics in a number of areas within the area of freedom, security and justice.“
One of the areas that the European Council mentioned was money laundering.
The European Council considered that the "Union must reduce the number of opportunities available to organised crime as a result of a globalised economy". The European Council therefore called upon the Member States and, where appropriate, the Commission to: "- further develop information exchange between the Financial Intelligence Units (FIUs), in the fight against money laundering. Within the framework of the European Information Management System, their analyses could feed a database on suspicious transactions, for example, within Europol; — mobilise and coordinate sources of information to identify suspicious cash transactions and to confiscate the proceeds from crime in line with the 1990 Council of Europe Convention on Laundering, Search, Seizure and Confiscation of the Proceeds from Crime, for instance through legislation determining whether proceeds are legitimate or not".

4. The need to develop statistics on money laundering in general - III
EUROSTAT’s publication
« MONEY LAUNDERING IN EUROPE »
(2013)
In 2011 Eurostat published a report on Money laundering in Europe, in the series Eurostat Methodologies and Working Papers. This represented a first attempt to collect information in a difficult and sensitive area of crime statistics.
In 2012, the FATF published a revised set of standards, and the Commission followed this up with the 4th AMLD. The COM proposal was adopted in The revisions entail a reinforcement of the “risk-based approach”, thus strengthening the need for good quality data both at national and EU level. This required solid statistical data.
In 2013, Eurostat published its 2013 edition of « Money laundering in Europe ». In its introduction, Eurostat underlined that « In the field of money laundering, there are significant gaps between what has been promised and what has been actually achieved in terms of statistical data; between data at a national level and comparable data across the continent. The European Commission, in partnership with the Member States and associated countries, has set out to fill these gaps. An integrated perspective is required to establish a cost/benefit analysis of national and European antimony laundering tools.
In the latest MoU between Eurostat and DG JUST it is underlined that DG JUST may seek advice from Eurostat on optimising the methods, standards or definitions for the collection of statistics. DG JUST may also seek advice from Eurostat on evaluating such statistics.

5. Article 44 – amended by 5th AML Directive
1. Member States shall, for the purposes of contributing to the preparation of risk assessments pursuant to Article 7, ensure that they are able to review the effectiveness of their systems to combat money laundering or terrorist financing by maintaining comprehensive statistics on matters relevant to the effectiveness of such systems.
The statistical needs on anti-money laundering of DG JUSTICE are linked to the so-called risk assessments that shall be conducted in accordance with Article 7 of the Directive (same wording 4th and 5th Directive) and Article 6(2)(b) of the new wording of the 5th Directive.
The first paragraph of Article 44 provides that « Member States shall, for the purpose of contributing to the preparation of risk assessments, ensure that they are able to review the effectiveness of their systems to combat money laundering or terrorist financing by maintaining comprehensive statistics on matters relevant to the effectiveness of such systems ».
I will come back to the wording of Article 6(2)(b) later.
JUST

6. AML/CFT Directives (4th and 5th)
RISK ASSESSMENT - II
Section 2
Articles 6 – 9
AML/CFT Directives (4th and 5th)
The risk assessment is dealt with in Articles 6 – 9 in both the 4th and the 5th AMLD:s.
What is a RISK in this context?
A risk means the ability of a threat to exploit the vulnerability of a sector for the purpose of money laundering or terrorist financing.
A risk falls within the scope of this assessment as soon as it affects the internal market because of its characteristics – whatever the number of MS concerned (even if it may concern only one Member State).
The scope covers both known and emerging risks – that is whether the risk has materialized or not.

7. RISK ASSESSMENT - II Supranational Commission (Article 6)
National Member States (Article 7)
Sectorial Sectors (Article 8)
High risk third countries Commission (Article 9)
The Financial Action Task Force (FATF) recommends that countries shall consider the capacity and anti-money laundering/countering the financing of terrorism (AML/CFT) experience of each sector submitted to AML/CFT requirements when they decide to conduct a risk assessment. Money laundering (ML) and terrorist financing (TF) risks shall be identified, assessed and understood, and measures to prevent ML/TF shall be commensurate with the risks identified.
On the basis of these recommendations, the Directive recognises the importance of a supranational approach to risk identification. It tasks the Commission to conduct the review of specific risks that could arise at European level and could affect the internal market ("supranational risk").
The Commission shall therefore conduct such Supranational Risk Assessment on money laundering and terrorist financing ("SNRA").
A risk identification is also conducted at national level by each Member States so that to ensure proper risk identification and risk mitigation of national specific risks.
A third layer of risk identification is provided by sectors themselves, taking into account risk factors including those relating to their customers, countries, products, services, transactions or delivery channels.
The Commission is also empowered to adopt delegated acts in order to identify high-risk third countries as regards AML/CFT risks.

8. Article 44 of Directive …
2. The statistics referred to in paragraph 1 shall include:
(a) data measuring the size and importance of the different sectors .., including the number of entities and persons and the economic importance of each sector;
(b) data measuring the reporting, investigation and judicial phases of the national AML/CFT regime, including the number of suspicious transaction reports made to the FIU, the follow-up given to those reports and, on an annual basis, the number of cases investigated, the number of persons prosecuted, the number of persons convicted for money laundering or terrorist financing offences, the types of predicate offences, where such information is available, and the value in euro of property that has been frozen, seized or confiscated;
As regards the risk assessment at Member State level (Article 7), the statistics referred to in the first paragraph of Article 44 « shall include:
data measuring the size and importance of the different sectors which fall within the scope of this Directive, including the number of entities and persons and the economic importance of each sector;
data measuring the reporting, investigation and judicial phases of the national AML/CFT regime, including the number of suspicious transaction reports made to the [financial intelligence units] FIU, the follow-up given to those reports and, on an annual basis, the number of cases investigated, the number of persons prosecuted, the number of persons convicted for money laundering or terrorist financing offences, the types of predicate offences, where such information is available, and the value in euro of property that has been frozen, seized or confiscated;”
JUST

9. Article 44 of Directive …
(c) if available, data identifying the number and percentage of reports resulting in further investigation, together with the annual report to obliged entities detailing the usefulness and follow-up of the reports they presented;
(d) data regarding the number of cross-border requests for information that were made, received, refused and partially or fully answered by the FIU, broken down by counterpart country.
(e) human resources allocated to competent authorities responsible for AML/CFT supervision as well as human resources allocated to the FIU to fulfil the tasks specified in Article 32.
Moreover:
(c) if available, data identifying the number and percentage of reports resulting in further investigation, together with the annual report to obliged entities detailing the usefulness and follow-up of the reports they presented;
And in green (and underlined in (d)) the new wording in the 5th AMLD:
(d) data regarding the number of cross-border requests for information that were made, received, refused and partially or fully answered by the FIU, broken down by counterpart country,
(e) Human resources allocated to competent authorities responsible for AML/CFT supervision as well as human resources allocated to the FIU to fulfil the tasks specified in Article 32.
And old d, now f) number of on site and off site supervisory actions
JUST

10. Article 6 of Directive …
“1. The Commission shall conduct an assessment of the risks of money laundering and terrorist financing affecting the internal market and relating to cross-border activities.
To that end, the Commission shall, by 26 June 2017, draw up a report identifying, analysing and evaluating those risks at Union level. Thereafter, the Commission shall update its report every two years, or more frequently if appropriate. »
Report from the Commission to the European Parliament and the Council on the assessment of the risks of money laundering and terrorist financing affecting the internal market and relating to cross-border activities, Brussels, , COM(2017) 340 final
As regards the supranational risk assessment (Article 6), « the Commission shall conduct anassessment of the risks of money laundering and terrorist financing the internal market and related to cross-border activities” on the 26 June 2017 at the latest and update its report every two years, or more frequently if appropriate.
The first supranational risk assessment report was published on 26 June 2017.
JUST

11. Article 44 of Directive … 4th AMLD (old wording)
5th AMLD (new wording)
3. Member States shall ensure that a consolidated review of their statistics is published.
…on an annual basis.
4. Member States shall transmit to the Commission the statistics referred to in paragraph 2.
… The Commission shall publish an annual report summarising and explaining the statistics referred to in paragraph 2, which has to be made available on its website.
There are also some amendments to the text at the end of Article 44.
READ.

12. Article 6 of Directive … 4th and 5th AMLD
2. The report referred to in paragraph 1 shall cover at least the following:
(a) The areas of the internal market that are at greatest risk;
4th AMLD (old wording)
5th AMLD (new wording)
(b) The risks associated with each relevant sector
… including, where available, estimates of the monetary volumes of money laundering provided by Eurostat for each of those sectors.
(c) The most widespread means used by criminals to launder illicit proceeds
… including, where available, those particularly used in transactions between Member States and third countries, independently of the latter’s classification as regards the list drawn up on the basis of Article 9(2).
There are also some amendments to the text in Article 6(2) concerning the supranational risk assessment..
READ.

13. Results: Average length of court cases (
Results: Average length of court cases (*) (1st instance/in days) EU Justice Scoreboard

14. Past data collections - through Expert Group on Money Laundering and Terrorist Financing
Pilot collection of AML/CFT data:
Reference years 2015 (and partly 2014)
Risk assessment Report of June 2017
2017 EU Justice Scoreboard (only court data)
Update of prosecution and court AML data
Reference year 2016
On-going
Improved response rate & data quality

15. Future data collection
Updated full questionnaire
Mostly through EGMLTF
Partly through ESTAT group?
What will the future bring?
As should earlier Article 44(4) of the new wording of the 5th AMLD » the Commission shall publish an annual report summarising and explaining the statistics » which in turn sshould also feed the supranational risk assessments. DG JUSTICE hopes that Eurostat will contribute or deliver such a product (as it did independently until 2013 with its AML in Europe report, as DG JUSTICE does not have the expertise or capacity to deliver such annual statistical reports. We would also like Eurostat to help us with methodological development (i.e. common statistical definitions/template; data collection from the Member States and consolidatying/reporting of statistics. DG JUSTICE has started to develop a statistical template.

16. Questions? European Commission
Directorate-General Justice and Consumers
Unit B3
Before I conclude, let me just mention that DG Justice is supporting further development of the quality of the justice systems.
Among others, we are glad to be financing a project on Court Quality Framework Design, in which the Justice Cooperation Internationale (JCJ) is an essential partner [a French public body which brings together the ministry of justice and all the main judicial institutions]. We are looking forward to seeing the fruit of this work.