Countries/Jurisdictions of Primary Concern - Romania
Romania’s geographical location makes it a natural transit country for narcotics, arms, stolen vehicles and persons trafficked by transnational organized criminal groups. As a result, Romania is vulnerable to financial activities associated with such crimes, including money laundering. Tax fraud, fraudulent claims in consumer lending, and trans-border smuggling of people, counterfeit goods, vehicles, and cigarettes are additional crimes prevalent within Romania that generate illicit proceeds. Laundered money comes primarily from international crime syndicates that conduct their criminal activity in Romania, and subsequently launder their illicit proceeds through illegitimate front companies. Commercial transactions have been the main method of money laundering, mainly through use of shell and offshore companies; this primarily involves fraudulent claims for value added tax reimbursement. In 2013, there were no reports that financial institutions in Romania were involved in transactions involving international narcotics trafficking.
Studies have found Romanian computer servers to be the second largest source of cybercrime transactions worldwide. Although a majority of victims reside in the United States, Romanian cybercriminals are increasingly targeting victims elsewhere in Europe, as well as in Romania itself.
For additional information focusing on terrorist financing, please refer to the Department of State’s Country Reports on Terrorism, which can be found at: http://www.state.gov/j/ct/rls/crt/
DO FINANCIAL INSTITUTIONS ENGAGE IN CURRENCY TRANSACTIONS RELATED TO INTERNATIONAL NARCOTICS TRAFFICKING THAT INCLUDE SIGNIFICANT AMOUNTS OF US CURRENCY; CURRENCY DERIVED FROM ILLEGAL SALES IN THE U.S.; OR ILLEGAL DRUG SALES THAT OTHERWISE SIGNIFICANTLY AFFECT THE U.S.: NO
CRIMINALIZATION OF MONEY LAUNDERING:
“All serious crimes” approach or “list” approach to predicate crimes: All serious crimes
Are legal persons covered: criminally: YES civilly: YES
KNOW-YOUR-CUSTOMER (KYC) RULES:
Enhanced due diligence procedures for PEPs: Foreign: YES Domestic: YES
KYC covered entities: Banks; institutions issuing consumer, commercial, and specialized credit; mortgage and real estate lenders; micro-lenders; factors, forfeiture agents, and financial leasing firms; guarantors; financial investment service providers; insurers and re-insurers; securities brokers; private pension funds; accounting, consulting, audit, and law firms; notaries; casinos; persons responsible for privatizations; non-governmental organizations; real estate brokers; and individuals or corporate traders of goods and/or services with a minimum 15,000 euro (approximately $ 20,700) cash turnover
Number of STRs received and time frame: 3,341: January 1 - October 31, 2013
Number of CTRs received and time frame: 8,460: January 1 - October 31, 2013
STR covered entities: Banks; institutions issuing consumer, commercial, and specialized credit; mortgage and real estate lenders; micro-lenders; factors, forfeiture agents, and financial leasing firms; guarantors; insurers and re-insurers; securities brokers; private pension funds; accounting, consulting, audit, and law firms; notaries; and real estate brokers
MONEY LAUNDERING CRIMINAL PROSECUTIONS/CONVICTIONS:
Prosecutions: 32: January – October, 31 2013
Convictions: 131: January – October, 31 2013
RECORDS EXCHANGE MECHANISM:
With U.S.: MLAT: YES Other mechanism: YES
With other governments/jurisdictions: YES
Romania is a member of the Council of Europe Committee of Experts on the Evaluation of Anti-Money Laundering Measures and the Financing of Terrorism (MONEYVAL), a FATF-style regional body. Its most recent mutual evaluation report can be found at: http://www.coe.int/t/dghl/monitoring/moneyval/Countries/Romania_en.asp
ENFORCEMENT AND IMPLEMENTATION ISSUES AND COMMENTS:
The National Office for the Prevention and Control of Money Laundering is the financial intelligence unit (FIU) of Romania and is responsible for developing, and coordinating the implementation of, an AML system. Other organizations working to combat money laundering in Romania include the Directorate for Investigating Organized Crime and Terrorism, and the National Anti-Corruption Directorate.
Romania’s FIU faces the continual challenge of limited financial, human, and technical resources. The Government of Romania should continue to improve communication between reporting and monitoring entities, as well as between prosecutors and the FIU.
The FIU drafted a 2013-2016 Operational Strategy, including goals and guidelines regarding the reporting, intelligence, and dissemination activities; the Strategy was approved by the government in April 2013. In June 2013, the FIU became a member of the Strategic Inter-Ministerial Group established to prevent and combat “macro-criminality” affecting the security of citizens and institutions. The FIU is a beneficiary of the EU’s SIENRO project, i.e., the “secured network for exchanging intelligence among law enforcement institutions in Romania, connected to the Europol-Siena secured network.”
In order to improve the rate of money laundering prosecutions and convictions, the Romanian authorities should not become overly reliant on STRs and other forms of financial intelligence but instead empower law enforcement and customs authorities to detect and investigate money laundering at the street level, including at borders and ports. Romania should improve implementation of existing procedures for the timely freezing, seizure, and forfeiture of criminal or terrorist-related assets. Romania should improve its efforts to thwart corruption in public procurement. In 2013, Romania reported at least one case in which corruption was identified as a predicate offense contributing to money laundering.