Scrutiny Over Cash Inflows Intensifies Amid Money Laundering Concerns
During a recent House ethics committee meeting, MPs expressed concerns about the substantial amounts of cash entering Cyprus, echoing the sentiment of needing to trace and understand these financial flows amidst fears of money laundering activities.
Deputy police chief Demetris Demetriou highlighted the ongoing investigations, with four cases currently in court involving €10 million. He shared that since his tenure began in August 2023, there has been a notable increase in large sums of money entering the country. Meanwhile, data presented to the deputies showed that out of €101.6 million declared, €90 million have not led to prosecutions.
The finance ministry’s permanent secretary, George Panteli, provided an overview of cash declarations at airport customs from January 2021 to March 2024, totaling €119 million. A significant portion of these declarations occurred between January 2023 and March 2024, amounting to €105 million. Out of these, 336 cases involving €101.6 million are under investigation by the police and the anti-money laundering unit (Mokas).
A cross-border investigation involving Eurojust and another EU country is among the significant cases being probed, as mentioned by Demetriou. Mokas chief Maria Kyrmizi Antoniou informed the committee that out of 17 suspicious cases flagged, 10 led to collaboration with foreign authorities. Antoniou also noted that Mokas initiates investigations based on reports of suspicious transactions, with around 2,000 cases reported in 2023.
In the real estate sector, Tax commissioner Sotiris Markides confirmed numerous developers accepting cash for property transactions. He is awaiting a list from customs to further investigate cash declarations linked to real estate purchases. Customs chief Theodora Demetriou emphasized the requirement for individuals to disclose the source and purpose of cash, with most citing real estate investments.
Anastasia Kamenou, an official from the interior ministry, mentioned that legal entities are scrutinized for high-risk indicators related to money laundering and tax avoidance. She revealed that at the start of 2023, 25% of entities were designated as high risk.
The committee chairman and Disy MP Demetris Demetriou criticized the apparent lack of coordination between state services in tracking cash inflows. He disclosed plans to introduce legislation capping cash transactions for purchases at €1,000. Currently, there is no limit provided cash purchases over €10,000 are declared.
Akel MP Irene Charalambides expressed disappointment over the persistent “black holes” in financial oversight, questioning why individuals would not use official channels for bringing money into Cyprus.
The committee’s discussions underscored a pressing need for improved cooperation and transparency in monitoring financial activities to prevent money laundering and ensure economic security.
