Hungary

New Documents

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.

The Hungarian National Bank announced that the World FinTech Festival in Budapest will be held on Dec. 8-9, 2020, in collaboration with Singapore FinTech Festival 2020, the world’s largest financial technology event.

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 : 81/141
Score : 4.99/10

TRANSPARENCY INTERNATIONAL i

Rank : 70/180
Score : 44/100

Tax Justice Network i

Rank : 75/133
Score : 54/100