AML AROUND THE WORLD
legislators for their inclination to “intimidate independent media” or “criminalize journalistic efforts.”
media sources when discussing Central
and Southeastern Europe. The accession
states made significant efforts to combat
corruption or at least to convince the
European Commission that this was the
case in the lead up to accession. However,
as has been pointed out following accession, combating crime and corruption
is no longer a priority, although it still
remains somewhat unclear whether this
is a result of inability or mere disinclination, as questioned by the Economist in an
article published in May 2008. The EU’s
new member states, Bulgaria and Romania,
have come under severe EU scrutiny this
year due to their slow progress in enacting
judicial reforms and in combating corruption, and in particular, following the publication of the EU’s third progress report
in July 2008. The fight against corruption
is highly politicized throughout Central
and Eastern Europe, and incidents of corruption involving some of the more progressive states such as Slovenia, Slovakia,
Latvia and Poland, have been published
in the media. However, the EU’s newcomers, Bulgaria and Romania (respectively) emerge as those countries ranked
lowest amongst the EU member states on
Transparency International’s Corruption
Perception Index. The same Economist
article strongly criticized Bulgaria’s position at the bottom of the list, claiming that
EU officials believed organized crime had
infiltrated and established itself within the
highest levels of government: “Bulgaria,
similarly, prefers talk to action. Multiple
new anti-corruption agencies are poorly
coordinated or have never got going. No
case of high-level official corruption has
led to a successful conviction, just as not
one of the more than 120 gangland shootings since 2001 has been cleared up.”
The good news…
Although there has been a significant
amount of negative media coverage and
political discussions surrounding the
levels of corruption, crime and fraud in
Southeastern Europe, and in particular within the EU in relation to its new
member states Romania and Bulgaria,
some progressive steps taken must be
noted at this stage:
• With regard to the access to information:
Transparency International published a
report in 2006 entitled, Using the Right
to Information as an Anti-Corruption
Tool claiming: “Bulgaria and Romania
show that over 50% of requests filed
receive the information sought, which,
for countries that relatively recently
were closed and repressive communist
systems and where maladministration
and corruptions are still serious problems, is a very significant level of disclosure.” This is an indication that publicly
available information can be retrieved
for the purpose of KYC or indeed, other
information-gathering exercises that
might be relevant to analyzing clients
and their business environments.
• Furthermore, one promising development was reported in The Sofia Echo
on September 29, 2008. The article
announced the signing of an agreement
by the Romanian, Bulgarian and Serbian
interior ministers (Christian David,
Mihail Mikov and Ivica Dacic) for cooperation against organized crime, including a focus on countering trafficking in
drugs and cigarettes, and providing for
joint anti-terrorist training.
Limitations of a not-so-free press
A further issue of concern, in particular when undertaking KYC due diligence
and other information-gathering exercises, rests in the reliability of the information retrieved from media sources.
In April 2008, the Economist presented
the debate surrounding concerns voiced
by the Open Society Institute (OSI) and
Freedom House regarding the increased
politicization of public broadcasting in
former communist countries. The article
highlights the legal constraints imposed
on press freedom, quoting Romania’s
United States Ambassador Micholas
Taubman, who criticized Romanian
Romania and the EU
When the European Commission
published its final monitoring report in
September 2006, announcing its “green
light” for Romania and Bulgaria to become
EU member states, it noted that this agreement was subject to further reforms in the
areas of judicial reform, organized crime
and corruption. The report noted that if
the requi ɕ