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Agents of the Osnabrück public prosecutor’s office have raided the ministries of finance and justice in Germany, on apparent suspicion that someone at the financial intelligence unit (FIU) has colluded in money laundering.
Osnabrück is in Lower Saxony in north-west Germany. The ministerial offices that the agents raided are in Berlin. According to the Ministry of Finance, the FIU is in Cologne, not far from Osnabrück. The Osnabrück District Court seems to have authorised the raid on August 10.
Responsibility for the FIU moved from the Federal Criminal Police Office to the customs authority (part of the finance ministry) in 2017 at the behest of Wolfgang Schäuble, who was the finance minister then. The Osnabrück prosecutorial office has jurisdiction over the FIU when it comes to corruption cases.
The finance ministry has written of the case: "It is a process that has been going on for more than a year. It is directed against unknown employees of the Central Office for Transaction Investigations (FIU).
"The underlying suspicion is expressly not directed against employees of the BMF. The public prosecutor's office is primarily concerned with the identification of employees of the central office in Cologne."
To cope with a continuously increasing number of reports, the workforce of the FIU has grown considerably in recent years, starting at 165 employees and going up to a total of 469, as of January 1 this year.
The statutory rights of the FIU to see the data of financial, administrative and law-enforcing authorities have also grown. It can now rifle through the transnational information system of the BKA (INPOL Bund) national police database, various file systems of the customs administration and the Central Public Prosecutor's Procedural Register.
The prosecutors say that the enquiry is a reaction to various complaints that they received which said that the FIU was doing nothing about suspicious transactions worth millions of euros, some of which involved payments to Africa, between 2018 and 2020.
Wirecard worries
The probe brings to mind the Wirecard scandal, a series of accounting scandals that resulted in the insolvency of Wirecard, a German payments processor. On June 25 last year, Wirecard petitioned a court to declare it insolvent. It owed its creditors almost US$4bn and had a gaping hole in its accounts. Many arrests of executives in Germany and Dubai followed.
At the beginning of this year, Felix Hufeld, the head of BaFin, Germany's financial regulator, announced his intention to resign over his organisation's handling of the affair.
The FIU came out of the story badly as well. According to the Süddeutsche Zeitung, the unit passed numerous indications of fraud to the Bavarian investigative authorities much too late.
It received about 1,000 suspicious transaction reports (STRs) about Wirecard, 97 of which turned out to be pertinent to the scandal, yet it only reportedly forwarded a fraction of them on.
