The Role of the Financial Intelligence Unit (FIU)

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Italy’s Financial Intelligence Unit (FIU) is an independent and autonomous body set up within the Bank of Italy pursuant to Legislative Decree 231/2007. It became operational on 1 January 2008, taking over from the Italian Foreign Exchange Office (UIC) as the central body charged with combating money laundering. It is structured in compliance with the international standards applying to all financial intelligence units (FIUs): they should be operationally autonomous and independently run; they should be the only unit of the kind in the country; they should possess expertise in financial analysis; and they should be able to exchange information directly and independently.

The administrative model was adopted for the unit in order to keep the task of financial analysis separate from that of investigative analysis, emphasising the independent role of prevention and the FIU’s function as a ‘buffer’ designed to preserve a sound economic and financial system. The legal status of the FIU, which is not a separate entity, stems from its institutional function as a centre for collecting, coordinating and channelling data and information of significant public interest.

The structure and operation of the FIU are governed by a Regulation of the Governor of the Bank of Italy, first issued on 21 December 2007 (Gazzetta Ufficiale No. 7, 9 January 2008) and renewed after the unit was reorganised on 18 July 2014 (G.U. No. 250, 27 October 2014). The Director is appointed through a measure approved by the Directorate of the Bank of Italy, upon proposal of the Governor, among persons meeting suitable standards of integrity, experience and knowledge of the financial system. The Director has full authority and liability over the Unit, while the Bank of Italy provides financial resources, as well as premises, equipment, personnel and technical resources. A committee of Experts, composed of the Director and four members nominated by the Ministry of the Economy and Finance after consulting the Governor of the Bank of Italy, acts in an advisory capacity (Article 6.1-4, Legislative Decree 231/2007.

The FIU draws up a yearly report on its activity, which the Director transmits to the Ministry of the Economy and Finance by 30 May for forwarding to Parliament, together with a report by the Bank of Italy on the funds and resources allocated to the unit (Article 6.5).

The FIU collects information on potential cases of money laundering and financing of terrorism, analyses the financial data, and decides whether the information should be passed to the investigative authorities (Special Foreign Exchange Unit of the Finance Police and Antimafia Investigation Bureau); it works closely with the judicial authorities. In particular, it examines the compulsory suspicious transactions reports filed by banks and financial institutions, as well as the monthly aggregate reports transmitted by financial intermediaries in accordance with Articles 6 and 40-41 of Legislative Decree 231/2007.

It may request additional information from reporting banks, consult files to which it has access by law or by arrangement with other national bodies, and exchange information with foreign counterparts (FIUs). The Unit can also inspect entities subject to anti-money-laundering obligations to examine reported and unreported transactions (Article 47.1.a) and verify compliance with ‘active cooperation’ requirements (Article 53.4).

The FIU can freeze suspicious transactions for up to five working days at the request of the Finance Police Unit, Antimafia Bureau, judicial authorities, or on its own initiative, provided that this does not interfere with any investigations under way. Suspension orders are issued in close cooperation with the investigative authorities (Article 6.7.c).

Depending on the outcome of its analysis, the FIU forwards suspicious transaction reports for further investigation to the Special Finance Police Unit and the Antimafia Bureau, notifies the judicial authorities of potential criminal offences, and files away all reports classified as unfounded (Articles 9 and 47).

The FIU draws on its database to conduct studies aimed at identifying and assessing phenomena, trends, practices and weaknesses of the system. It analyses single irregularities, economic sectors at risk, categories of payment instruments, and local economies (Article 6.7.a). An outline of the results of these studies is transmitted to the other authorities (Article 9.9).

The Unit draws up regulations on the filing of suspicious transactions reports (Article 41.1bis) and on the transmission of aggregate data by financial intermediaries (Article 40.2). It promotes active cooperation on the part of the entities concerned and facilitates the identification of suspicious transactions by providing illustrations of anomalous economic and financial conduct (Article 6.7.b) and disseminating the irregularity indicators issued by the Bank of Italy, the Ministry of the Interior and the Ministry of Justice (Article 41.2). Subsequently, it provides feedback on the outcome of reports (Article 48).

Breaches of suspicious transactions reporting requirements are identified through on-the-spot checks of entities and on the basis of available information. Where appropriate, the FIU opens the procedure for the issue of sanctions by the Ministry of the Economy and Finance (Article 60).

The FIU relies on cooperation and information exchange at national and international level to perform its duties effectively and more generally to ensure the efficiency and efficacy of the anti-money-laundering system as a whole. Cooperation may take different forms: supervisory authorities may waive the rule of professional secrecy when working together and with the FIU, Finance Police and Antimafia Bureau in order to facilitate the task of all concerned; supervisory authorities (as well as government departments and professional associations) may be required to provide information to the FIU; and the FIU and the investigative and judicial authorities may collaborate in numerous areas to identify and examine anomalous financial flows and transactions.

International cooperation is governed by specific provisions concerning relations between the FIU for Italy and the FIUs of other countries (Article 9). Information on suspicious transactions may be exchanged in derogation of the rule on professional secrecy and under memorandums of understanding, obtaining the necessary investigative information from the Finance Police and the Antimafia Bureau (Article 9.3; EU Council Decision 2000/642/JHA). International exchanges of information take place via secure and protected channels of communication, the Egmont Secure Web, a global system run by the Egmont Group, and FIU.NET, a network shared by all the EU FIUs. Procedures for information exchanges with foreign investigative authorities are regulated by a memorandum of understanding with the FIU (Article 9.4).

Transactions in gold for investment purposes and in gold metal for predominantly industrial use for a value of €12,500 and over must be reported to the FIU in compliance with Law 7/2000 relating to the gold market. The FIU is also engaged in the fight against the sexual exploitation of children and paedophile pornography via Internet (Law 38/2006).