Hungary

New Documents

The Council of Europe announced a meeting between its Secretary General Marija Pejčinović Burić and the Hungarian Minister for Foreign Affairs and Trade Péter Szijjártó concerning global efforts to combat crime and safeguard human rights.

The Council of Europe Committee of Experts on the Evaluation of Anti-Money Laundering Measures and the Financing of Terrorism, or Moneyval, published a 4th enhance follow-up report and technical compliance re-rating on Hungary’s anti-money laundering and counterterrorist financing regime.

News

Enforcement Actions

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Important Facts

  • The U.S. State Department classifies Hungary as a jurisdiction of concern. While the jurisdiction is not a major financial center, it acts as a link between the former Soviet Union and Western Europe. The country's primarily cash-based economy and well-developed financial services industry make it attractive to foreign criminal organizations. Organized crime groups increasingly use the country as a base for operating cyber-related fraud and laundering proceeds using shell companies and the banking system. Drug traffickers also exploit Hungary as a transit point for moving illegal drugs from Asia and Turkey to Europe. Money laundering cases mostly stem from financial and economic crimes, such as tax-related crimes, cyber-related fraud, embezzlement, misappropriation of funds, theft of bankcards and social security fraud. Illicit proceeds also result from narcotics trafficking, prostitution, human trafficking and organized crime activities. There is a black market for smuggled goods in Hungary, primarily related to customs, excise, value-added tax evasion, as well as tobacco smuggling and human trafficking on the Hungarian-Ukrainian border.
  • KYC Covered Entities:  Banks; financial service providers; investment service providers; employer pension service providers; insurance service providers; intermediary and voluntary mutual insurance fund service providers; commodity exchange service providers; sellers and issuers of international postal money orders; real estate agents and brokers; auditors; accountants; certified and noncertified tax consultants and advisors; casinos, card rooms, online gaming operators; precious metal and high-value goods traders; traders accepting cash payments of more than 3,600,000 forints (approximately $12,900); lawyers; notaries; and trustees
  • STR Covered Entities:  Banks; financial service providers; investment service providers; employer pension service providers; insurance service providers; intermediary and voluntary mutual insurance fund service providers; commodity exchange service providers; sellers and issuers of international postal money orders; real estate agents and brokers; auditors; accountants; certified and noncertified tax consultants and advisors; casinos, card rooms, online gaming operators; precious metal and high-value goods traders; traders accepting cash payments of more than 3,600,000 forints (approximately $12,900); lawyers; notaries; and trustees
  • Enhanced Due Diligence Procedures for PEPs: Foreign: Yes; Domestic: No
  • Money Laundering Criminal Prosecutions/Convictions: Prosecutions: 6 (January – October, 2015); Convictions: 5 (January – October, 2015)
Source: 2016 International Narcotics Control Strategy Report (INCSR)

Rankings

FATF i | 2013 methodology

Technical Effectiveness
Compliant : 5 High : 0
Largely Compliant : 29 Substantial : 2
Partially Compliant : 6 Moderate : 5
Non-Compliant : 0 Low : 4

Hungary's technical compliance was re-rated in a May 26, 2021 follow-up report

BASEL i

Rank : 48/110
Score : 5.04/10

TRANSPARENCY INTERNATIONAL i

Rank : 69/179
Score : 44/100

Tax Justice Network i

Rank : 75/133
Score : 54/100