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Greece

Last updated 06/07/2010

CENTRAL AUTHORITY FOR REPORTING

A National Authority Committee was established under Presidential decree, N°401/10.12.96, in order to collect, assess, and investigate information of transactions suspected of being linked to money laundering.

The Committee is under a statutory obligation to forward the relevant file, all acquired information, its investigatory findings and its opinion to the public prosecutor if it concurs that a transaction is suspicious. When suspicions are believed to be unfounded, the cases are kept in the Committee’s archives for possible use in other domestic or international investigations.

The Committee must complete its investigations within 5 days of receipt of the report or other information concerning a possible breach of money laundering legislation.

The Committee also assists other similar foreign organisations, helping to evaluate and investigate information on income derived from criminal activities.

This Committee is now referred to as the ‘Hellenic Anti-Money Laundering and Anti-Terrorism Financing Commission – (H.A.M.L.C.)’.

On 4 August 2008, Complinet reported that the Greek Parliament passed a law to replace its National independent anti-money laundering body with a new Finance Industry Committee aimed at tackling economic crime and money laundering [1]. 

ANTI-MONEY LAUNDERING REGULATOR(S)

  • Hellenic Financial Intelligence Unit;

  • The FSI against economic crime, money laundering and terrorism;

  • The Bureau of Special Investigations (BSI) of the Ministry of Economy & Finance (ex. S.D.O.E. – Economic Crime Investigation Unit);

  • The Force Against Economic Crime of the Tax Authority under the Command of the Ministry of Finance.

HAS THE THIRD EU MONEY LAUNDERING DIRECTIVE BEEN IMPLEMENTED? IF NOT, WHEN IS IT EXPECTED TO BE IMPLEMENTED?

Yes. As of 5 August 2008, Law No. 3691 successfully implemented the Third EU Money Laundering Directive. This was published in the Official Government Gazette (Issue 1, No. 186).

LIST THE LAWS REGARDING ANTI-MONEY LAUNDERING, INDICATING WHICH LAWS ARE APPLICABLE TO LAWYERS.

Law 3691/2008 successfully implemented the Third EU Money Laundering Directive.

ARE VISITING LAWYERS SUBJECT TO LOCAL LAWS REGARDING ANTI-MONEY LAUNDERING, AND, IF SO, TO WHAT EXTENT?

Yes. To the full extent that Greek lawyers are.

LIST ANY MONEY LAUNDERING GUIDANCE FOR LAWYERS (FOR EXAMPLE, LAW SOCIETY OR BAR ASSOCIATION GUIDELINES) CURRENTLY IN PLACE.

  • Law 3691/2008 extends the regulated sector to lawyers (see the relevant provisions of the Third Money Laundering Directive Art.1-20);

  • Code of Practice for (Greek) Lawyers: Legislative Decree 3026/1954 (Government Gazatte A’ 235 “Code of Practice for Lawyers”/1954);

  • Code of Ideology of (Greek) Lawyers: Instrument drafted by the Board of Directors of Athens Bar Association (ABA) on January 4, 1980 and officially published in the Code of Legal Tribune, No 34/1986, p. 481;

  • The Council of Bars and Law Societies of Europe (CCBE);

  • The European Consolidation Banking Directive (2002/12/EC) – (The new legal framework of European Banking System), which by virtue of Article 28 of the Constitution of the Greeks, has increased formal and substantial validity and force in the Greek legal order;

  • Law 3305/2005 (Penal Code and Special Penal Laws) regulating various forms of economic crime, fraud, narcotics, contraband, terrorism, etc.;

  • Law 3258/2004 (Organization of Courts) regulating the judiciary and court clerks.

IS THE LAW SOCIETY/BAR ASSOCIATION INVOLVED IN SUPERVISING OR ENFORCING COMPLIANCE WITH ANTI-MONEY LAUNDERING REGULATIONS?

Yes. The Law Society is compelled to encourage full adherence to anti-money laundering regulation by all its members. 

DESCRIBE CLIENT DUE DILIGENCE REQUIREMENTS, INCLUDING WHEN IT MUST BE UNDERTAKEN BY LAWYERS.

Lawyers are not under a formal obligation to take information/details from clients regarding their identities, and no evidence was presented to the evaluation team to suggest that they are doing so.

DOES YOUR COUNTRY FOLLOW A RISK-BASED APPROACH TO CLIENT DUE DILIGENCE BY LAWYERS?

No. However, there have been initial discussions of amending the framework, which governs the credit institutions and financial organizations supervised by the Bank of Greece, which would adopt some, if not all, characteristics of the risk-based approach. Any amendments could also affect or influence the legal profession.

ARE THERE ENHANCED DUE DILIGENCE MEASURES FOR CERTAIN TYPES OF CLIENTS, FOR EXAMPLE, POLITICALLY EXPOSED PERSONS?

Yes.

ARE THERE SIMPLIFIED DUE DILIGENCE MEASURES FOR CERTAIN TYPES OF CLIENTS, FOR EXAMPLE, LISTED COMPANIES?

Yes.

ARE LAWYERS PERMITTED TO RELY ON THIRD PARTY DUE DILIGENCE? IF YES, PLEASE DESCRIBE.

No.

WHEN IS A LAWYER UNDER AN OBLIGATION TO REPORT SUSPICIOUS TRANSACTIONS?

Lawyers must report suspicious activities when assisting clients with transactions relating to the purchase or sale of real property or business entities, managing clients’ assets, opening or managing bank or securities accounts, and organising contributions for the creation, operation, or management of companies, including offshore companies.

An exception from reporting applies to information acquired by the lawyer before, during, or after trial or in the court of ascertaining the legal position of the client. However, if the lawyer knows or seriously suspects that the client is seeking legal advice for the purpose of committing money laundering, the lawyer must report the relevant information regardless of the foregoing exception.

DOES ATTORNEY/CLIENT PRIVILEGE AND/OR DUTIES OF CONFIDENTIALITY PROVIDE A DEFENCE OR PARTIAL/TOTAL EXCEPTION TO THE REQUIREMENT TO REPORT SUSPICIOUS TRANSACTIONS? 

No.

DOES LOCAL LAW PROVIDE ANY CRIMINAL AND/OR CIVIL INDEMNITY TO A LAWYER WHO HAS REPORTED A SUSPICIOUS TRANSACTION?

No because it is the duty of the lawyer to make the report.

ONCE A SUSPICIOUS TRANSACTION REPORT HAS BEEN FILED, IS A LAWYER ALLOWED TO PROCEED WITH THE LEGAL ADVICE/TRANSACTION, AND, IF SO, MUST CONSENT FROM AUTHORITIES BE OBTAINED FIRST?

Yes.

IS THERE A TIPPING-OFF PROHIBITION? IF YES, PLEASE DESCRIBE.

Article 4.16 imposes a penalty for the breach of the tipping-off prohibition which is punishable with imprisonment of up to 2 years and a fine.

DESCRIBE ANY RESTRICTIONS ON ACCEPTING A NEW CLIENT.

There are currently no restrictions on accepting new clients.

ARE THERE ONGOING MONITORING REQUIREMENTS FOR EXISTING CLIENTS? IF YES, PLEASE DESCRIBE.

There are currently no ongoing monitoring requirements for existing clients.

DESCRIBE ANY OTHER WAYS IN WHICH LAWYERS ARE AFFECTED BY ANTI-MONEY LAUNDERING LEGISLATION.

A lawyer is under a continuous obligation to report offenders.

HAVE LAWYERS IN YOUR JURISDICTION BEEN IMPLICATED IN MONEY LAUNDERING, INCLUDING ANY TYPE OF COMPLAINT, ARREST OR PROSECUTION?

In August 2006 a Greek judge was sentenced in the first degree to 86 years of imprisonment for corruption offences, bribery and conspiracy, seven lawyers were sentenced to jail for a period of four years for related offences, and another female judge has fled the country due to criminal charges pending against her.

This is the first trial in a series of trials that will take place in the near future as regards corruption offenses and as part of the “cleaning-up of the judicial body” policy of the present cabinet. [2]

HAS THE FINANCIAL ACTION TASK FORCE (FATF) CONDUCTED A MUTUAL EVALUATION OF THIS COUNTRY, AND, IF SO, WHAT WERE THE FINDINGS CONCERNING LAWYERS’ COMPLIANCE WITH THE FATF 40+9 RECOMMENDATIONS?

Yes. Initially, the Financial Action Task Force (FATF) conducted the “Third Mutual Evaluation on Anti-Money Laundering and Combating the Financing of Terrorism” (opens PDF document) in Greece on 29 June 2007.

In accordance with Section 4 of this report, lawyers are subject to the legislation when they engage in the range of activities covered by the FATF Recommendations. Furthermore, in accordance with Sub-section 4.2, lawyers are not under a formal obligation to take identity information from clients, and no evidence was presented to the evaluation team to suggest that they are doing so.

The FATF expressed concerns over the potential abuses by lawyers of the wide-spread client privilege tool when dealing with suspected money laundering. This is specially so, as legal advice remains subject to the obligation of professional secrecy, unless the legal counsellor himself/ herself is involved in money laundering, counsels the commission of money laundering or knows that the client is seeking legal advice for the purpose of committing money laundering (page 23).

The initial report is available to download from the FATF website.

A summary of this report can also be found here (opens PDF document).

Following the adoption of the initial report, in accordance with the normal FATF follow-up procedures, Greece has provided the FATF Plenary with its recent Mutual Evaluation Interim Follow-up Report at the February 2010 Plenary meeting.

In view of this report, Greece seems to have taken actions to make the designated non-financial businesses and professions (DNFBPs) aware of their AML/CFT obligations. For instance, the Ministry of Justice has already issued a circular containing instructions for lawyers and notaries regarding implementation details of their obligations laid down by the provisions of the AML Law (2008) and the other supervisory authorities–paragraph 131 of the interim report.

In general, it appears that Greece has improved its compliance with some of the recommendations, whereas in case of others their performance is unsatisfactory. For example, compliance with recommendation 6 has been rated as ‘NC’ (ie, non-compliance). The reason is that there is a doubt as to the scope of the lawyers’ obligation extending to politically exposed persons (PEPs).

According to the interim report:

  • The definition applies to Community and international PEPs although persons in these categories resident in Greece are not included in the definition;

  • The law provides for a definition of “immediate family members” and “persons known to be close associates” but these persons are not included in the definition of PEP set out in Article 22.1; and

  • It is not certain that the requirement to obtain senior management approval applies in the case a customer subsequently becomes a PEP.


Information supplied by:

Emmanuel S. Ioannides
IBA Member
Jurist
Economic Crime Expert / IR Expert
Email: esi@otenet.gr

_______
Sources

  1. Marcus Simpson, “Greek abolishes anti-laundering body”, 4 August 2008, www.complinet.com.
  2. Marcus Simpson, “Greek judge receives 86-year sentence for laundering and corruption”, 10 August 2006, www.complinet.com.