Germany’s efforts in the fight against money launderers and tax evaders have so far largely come to nothing. The investigating authorities are missing important data from the transparency register, in which companies are supposed to enter their owners. Limited liability companies had time to do this until the middle of the year – but so far only a little more than half have complied with this obligation.
The aim of the Transparency Act was to disclose the ultimate owners behind the company and association in the country. At the request of WELT AM SONNTAG, the responsible Federal Ministry of Finance (BMF) announced that of the almost 1.5 million limited liability companies in the country that are subject to registration, only 838,348 have so far registered.
This means that in many cases it remains virtually impossible for law enforcement agencies to disclose veiled structures for money laundering or terrorist financing, or even to understand which companies are backed by Russian oligarchs despite sanctions. Both oligarchs and criminal organizations such as clans often use complex corporate networks to disguise their property.
Frank Buckenhofer, chairman of the customs police union, also criticizes the fact that the detection of crimes such as money laundering and terrorist financing is made more difficult by the poor data situation. “An incomplete transparency register delays police investigations, which is more than annoying.”
In the event of missing or incorrect entries, the authorities would have to take detours to find out who the true owner of a conspicuous legal entity was. “The state of the transparency register is symptomatic of the poor data situation in Germany, which makes life difficult for us investigators,” adds Buckenhofer.
Left-wing MP Pascal Meiser also criticizes the sparse data on corporate structures: “The transparency register is still miles away from bringing comprehensive light into the darkness of non-transparent ownership structures of companies and real estate,” he says.
Meiser and his parliamentary group had already made a small inquiry to the federal government in the summer and asked how many of the legal forms had already been entered in the register. The Government’s Response: For limited liability companies, the figure is 740,649. So between August and December of this year, only 97,699 other GmbHs registered – not much progress.
In the request, Meiser also wanted to know what measures the Ministry of Finance would like to take to ensure that the entries in the transparency register are complete and correct. The answer: In addition to plausibility checks on new entries, the ministry relies above all on the discrepancy reports from those who are obliged under money laundering law.
These are, for example, notaries, lawyers, goods dealers and brokers who carry out money laundering checks on their customers and have to compare data with the transparency register. If there are contradictions, they must report this to the Bundesanzeiger Verlag, which is responsible for the transparency register.
Many of the discrepancy reports come from notaries. Martin Thelen from the Federal Chamber of Notaries complains: “The control work with regard to discrepancies in the transparency register is largely the responsibility of the obligated parties.”
But the state must also do more – for example by completely digitizing the commercial register so that it can be compared with the transparency register.
In addition, the companies should have been better informed by official bodies that they should be entered in the transparency register. “Many just slept through it,” believes Thelen.
Christoph Trautvetter from the Tax Justice Network also sees the government as having a duty to make register control more efficient. He recommends taking a look at neighboring Austria. There, the transparency register was linked to the trade and population register in order to automatically filter out discrepancies.
Comparisons with tax data would also be carried out on a random basis. “If, for example, a trustee is entered in the transparency register as the owner of a company that owns several properties, but has no rental income, this represents a striking contradiction.” The real owner is then probably someone else who deliberately does not want to identify himself .
But Germany is still a long way from such solutions. Most recently, in the second law on the enforcement of sanctions, it was decided that the transparency register should be supplemented with real estate data from the land register – an interim solution, as the digitization of the land register will take years.
Markus Herbrand, financial policy spokesman for the FDP, sees this as an opportunity to catch on to owners who have so far successfully concealed property ownership. In addition, the government wants to ensure that the entries in the transparency register increase.
“In addition to the tools that are already available, more stringent controls and sensitive fines will have to be applied,” he says. “We finally want to make the trade repository the sharp sword that will help us succeed in the fight against money laundering.”
The Green financial politician Sabine Grützmacher refers to the coalition agreement – there her group would have explicitly anchored that the data quality in the transparency register should be improved. She advocates appropriate sanctions for those companies that do not comply with their obligations. “Almost three years after the register was introduced, the grace period should now be over for good.”
Fines for missing entries are currently suspended for a further year after the transition period. GmbHs that have not entered the register do not have to expect fines until the end of June.
Around 25,000 administrative offense proceedings were opened between July 2020 and August 2021, but only just under two-thirds of them were completed.
