Proposal by the Chancellor of Justice for bringing the Money Laundering and Terrorist Financing Prevention Act, the Credit Institutions Act, the Law of Obligations Act, and the State Fees Act into conformity with the Constitution
Session: 15th Estonian Parliament, 3rd session, plenary session
Date: 2024-05-13 18:04
Participating Politicians:
Total Speeches: 37
Membership: 15
Agenda Duration: 40m
AI Summaries: 37/37 Speeches (100.0%)
Analysis: Structured Analysis
Politicians Speaking Time
Politicians
Analysis
Summary
The first item on the agenda was the proposal by the Chancellor of Justice to bring the Money Laundering and Terrorist Financing Prevention Act, the Credit Institutions Act, the Law of Obligations Act, and the State Fees Act into compliance with the Constitution. According to the session procedure, presentations were limited to a 20-minute timeframe, and members of the Riigikogu could ask each presenter one oral question; the discussion involved representatives of the committees and factions, and the agenda was introduced by Chancellor of Justice Ülle Madise as part of a joint initiative. In this regard, the need was emphasized to balance stringent requirements for the prevention of money laundering and terrorist financing with human rights, legal protection, and the opportunity to seek judicial remedy. The second part presented real-life examples of problematic situations where the closing of accounts or the restriction of certain transactions complicates the proper exercise of rights and access to judicial recourse. The discussion focused on two main solution options: firstly, expanding the possibilities for cash circulation, and secondly, the idea of creating a separate bank account for everyone, the operations of which would be monitored as needed (within the framework of handling court orders, employment income, and state fees). It was also acknowledged that contradictions between directives and the state's regulatory needs require clear guidance and cooperation with various institutions.
Decisions Made 1
The proposal was supported by 65 members of the Riigikogu, and there were neither abstentions nor opposing majorities. The Riigikogu decided to task the Finance Committee with initiating a draft bill aimed at bringing the Money Laundering and Terrorist Financing Prevention Act, the Credit Institutions Act, the Law of Obligations Act, and the State Fees Act into compliance with the Constitution.
Most Active Speaker
Varro Vooglaid (pid: ehjpLK1FIak) was designated as the most actively involved speaker. He primarily represents the right-wing/conservative movement, and his participation essentially shaped the initial discussions and questions concerning the legitimacy and core objectives of banks' decision-making processes.
Esimees Lauri Hussar
AI Summary
Chairman Lauri Hussar describes the content and procedure of the agenda item: the discussion of the Chancellor of Justice’s proposal concerning the prevention of money laundering and terrorist financing and the process of bringing related laws into conformity with the Constitution. The discussion will feature three presenters—the Chancellor of Justice, a representative of the Constitutional Committee, and a representative of the Finance Committee—with each speaker allotted up to 20 minutes. A member of the Riigikogu may pose one oral question. Following this, he invites Chancellor of Justice Ülle Madise to the podium.
Õiguskantsler Ülle Madise
AI Summary
Chancellor of Justice Ülle Madise highlights that the intervention of the Riigikogu is necessary due to the closure of several individuals' accounts and the resulting restriction on access to court. She proposes two solutions: expanding cash circulation or establishing a controlled common bank account for all people, which could be monitored if necessary. She emphasizes that these amendments must be brought into compliance with Sections 14 and 15 of the Constitution by making corresponding changes to the Money Laundering and Terrorist Financing Prevention Act, the Credit Institutions Act, the Law of Obligations Act, and the State Fees Act.
Esimees Lauri Hussar
AI Summary
Chairman Lauri Hussar thanked the speaker, announced that the questions were next on the agenda, and first invited Varro Vooglaid to take the floor.
Varro Vooglaid
Profiling Fraktsiooni mittekuuluvad Riigikogu liikmedAI Summary
He draws wider attention to the problem that the closure of bank accounts without any proof of guilt or legal wrongdoing may violate the principles of non-discrimination and the presumption of innocence, and in a monopolistic banking environment, this can lead to a person's social exclusion.
Õiguskantsler Ülle Madise
AI Summary
Chancellor of Justice Ülle Madise pointed out that conflicts between EU directives are causing issues regarding access to basic payment accounts and banking operations, as well as in the prevention of money laundering and terrorist financing. She added that the Riigikogu (Estonian Parliament) should seek advice from the people who are actually making these decisions and issuing instructions to the Financial Supervision Authority, stressing that an opaque system could lead to the persecution of individuals.
Esimees Lauri Hussar
AI Summary
Chairman Lauri Hussar invites Urmas Kruuse.
Urmas Kruuse
Profiling Eesti Reformierakonna fraktsioonAI Summary
Urmas Kruuse asks whether the banking practice of closing an account and then considering its reopening would mean, a priori, that the client is unable to open or replace a similar account at another bank.
Õiguskantsler Ülle Madise
AI Summary
The examples we have received indicate that in Estonia, if one bank closes an account, other banks usually won't open it. However, in Finland, people have still managed to successfully open an account.
Esimees Lauri Hussar
AI Summary
Chairman Lauri Hussar asks Urve Tiidus to come forward to speak.
Urve Tiidus
Profiling Eesti Reformierakonna fraktsioonAI Summary
Urve Tiidus presented two examples of fraud: in one case, the account of the person transferring the funds was closed, but no suspicions arose regarding the owners of the destination account. She then referenced a Finnish example where opening an account was nevertheless possible, and asked how broad a generalization could be made about European Union banks, and whether they act in the same manner or differently.
Õiguskantsler Ülle Madise
AI Summary
Chancellor of Justice Ülle Madise stressed that in cases involving victims of cybercriminals, conviction and tracking the crime are extremely complicated due to the jurisdictions of third countries. However, solutions have been implemented in other European Union countries that allow access to bank accounts and meet both EU and US requirements, and these experiences could be learned from Finland, Lithuania, and Denmark.
Esimees Lauri Hussar
AI Summary
Chairman Lauri Hussar invited Tanel Kiik onto the stage and asked him to come.
Tanel Kiik
Profiling Fraktsiooni mittekuuluvad Riigikogu liikmedAI Summary
Tanel Kiik is asking about the use of cash in the context of paying state fees, inquiring specifically about what obstacles exist beyond the legislative framework and how this would look in practice.
Õiguskantsler Ülle Madise
AI Summary
Chancellor of Justice Ülle Madise stated that these issues can be resolved by amending laws with minimal risk. She noted that no one supported increasing cash transactions, and if state fees and other settlements are paid in cash, that cash must originate somewhere. Consequently, paying wages in cash should be encouraged more than it is currently, which would provide tax collectors with an interesting picture.
Esimees Lauri Hussar
AI Summary
Chairman Lauri Hussar calls upon Mait Klaassen.
Mait Klaassen
Profiling Eesti Reformierakonna fraktsioonAI Summary
He/She raises the question of whether a single-account law would allow banks to monitor a person's entire economic activity, and whether this would not infringe upon their fundamental rights.
Õiguskantsler Ülle Madise
AI Summary
If there are serious suspicions regarding money laundering or the financing of terrorism, and the regular account has been closed, the individual is still left with an account that has limited usage. Society could permit restricted transactions, but the bank must delve deeper and verify the sources of income in the event of extraordinary deposits, in order to ensure the income is legitimate, that taxes are paid, and to prevent the funds from being used for money laundering or promoting terrorism.
Esimees Lauri Hussar
AI Summary
The Chairman thanks [the previous speaker] and calls upon Eduard Odinets.
Eduard Odinets
AI Summary
Eduard Odinets highlights the question of how to monitor transactions associated with using a single account, and whether permitted and prohibited transactions should be clearly defined by law, or if this falls under the purview of the agreement between the individual and the bank. Furthermore, he stresses the necessity of protecting individual rights and curbing the arbitrary power of banks.
Õiguskantsler Ülle Madise
AI Summary
Chancellor of Justice Ülle Madise emphasized that banks need clear regulation that would genuinely support them, because the suspicion of money laundering or terrorist financing is devastating for a bank, and the suspicion of failure to comply with the due diligence obligation is also severe. She added that if the Riigikogu chooses this path, it is very commendable that at least the measures that could restrict the use of that account have been described in general terms.
Esimees Lauri Hussar
AI Summary
Chairman Lauri Hussar invites Aivar Kokk to take the floor.
Aivar Kokk
Profiling Isamaa fraktsioonAI Summary
Aivar Kokk asks whether, if an account has been closed, the person should go back to the same bank where they previously held the account, or if the solution could be to approach a different bank.
Õiguskantsler Ülle Madise
AI Summary
Thank you very much—that is one possible solution. Your point is absolutely correct, and we believe that this kind of client is costly for the bank because they require constant monitoring.
Esimees Lauri Hussar
AI Summary
Chairman Lauri Hussar invites Anastassia Kovalenko-Kõlvart to the stage.
Anastassia Kovalenko-Kõlvart
Profiling Eesti Keskerakonna fraktsioonAI Summary
This address asks whether restrictions on paying state fees and fines in cash have led to situations where non-payment causes bailiff costs to increase, and whether these cases have been resolved in any way.
Õiguskantsler Ülle Madise
AI Summary
Chancellor of Justice Ülle Madise offered her thanks, stating that while no major concerns have been brought to the office recently, the Riigikogu retains the discretion to decide the extent to which cash usage should be promoted versus favoring card payments. She also expressed gratitude for the consideration of fines, adding the remark that a decent person doesn't incur a penalty.
Esimees Lauri Hussar
AI Summary
Chairman Lauri Hussar thanks Chancellor of Justice Ülle Madise and announces that there are no further questions, and next invites Kalle Laanet, a member of the Constitutional Committee, to the podium.
Kalle Laanet
Profiling Eesti Reformierakonna fraktsioonAI Summary
The Riigikogu Constitutional Committee discussed the proposal of the Chancellor of Justice and unanimously supported it, appointing Kalle Laanet as the leading representative, taking into account the differences in the rights of natural persons and legal entities, and concern over restrictions on bank account opening.
Esimees Lauri Hussar
AI Summary
The Chair thanks the speaker and invites the audience to ask questions, subsequently turning to Varro Vooglaid.
Varro Vooglaid
Profiling Fraktsiooni mittekuuluvad Riigikogu liikmedAI Summary
Vooglaid raises the question of whether discriminatory treatment is fundamentally acceptable in Estonia, illustrating this with a café example and stressing that the same behavior would be controversial in banks, and that the principle of equal treatment must apply to everyone.
Kalle Laanet
Profiling Eesti Reformierakonna fraktsioonAI Summary
Kalle Laanet shares his personal viewpoint that if both situations involve private enterprise, the financial institution ought to justify its decision, and provided it isn't a state secret, doing so would be courteous and proper.
Esimees Lauri Hussar
AI Summary
Chairman Lauri Hussar thanked the rapporteur, announced that there were no further questions, and invited Annely Akkermann, the Chairman of the Riigikogu Finance Committee, to the Riigikogu podium to present the discussion that had taken place in the Finance Committee.
Annely Akkermann
Profiling Eesti Reformierakonna fraktsioonAI Summary
The Finance Committee discussed bringing the Chancellor of Justice's letter into compliance with the Constitution due to contradictions between anti-money laundering requirements and payment services directives, and reached a consensus to support the Chancellor of Justice's proposal to align the Money Laundering and Terrorist Financing Prevention Act, the Credit Institutions Act, the Law of Obligations Act, and the State Fees Act with the Constitution, while simultaneously considering the creation of a social account, sending it for the coordination round in May, and planning further steps in the autumn.
Esimees Lauri Hussar
AI Summary
The Chairman thanked the rapporteur, stated that there were no questions, announced the commencement of the debate, and invited Andre Hanimäe, representing the faction of the Social Democratic Party, to the Riigikogu rostrum.
Andre Hanimägi
Profiling Fraktsiooni mittekuuluvad Riigikogu liikmedAI Summary
Andre Hanimägi emphasized that the failure of banks to open accounts or the closure of existing accounts raises issues concerning the safeguarding of human rights and contributes to social exclusion. Therefore, it is crucial to allow accounts to be opened under certain conditions, establish a financial ombudsman, and initiate a discussion regarding the expansion of the Financial Supervision Authority’s competencies, given that resorting to court action is often prohibitively expensive.
Esimees Lauri Hussar
AI Summary
Chairman Lauri Hussar put the adoption of the proposal to a vote and announced that if it receives the Riigikogu's affirmative vote, the Finance Committee will initiate draft legislation to bring the Money Laundering and Terrorist Financing Prevention Act, the Credit Institutions Act, the Law of Obligations Act, and the State Fees Act into compliance with the Constitution.
Esimees Lauri Hussar
AI Summary
The proposal was supported by 65 members of the Riigikogu, with no abstentions or votes against, and the Finance Committee must initiate a draft bill to bring the Money Laundering and Terrorist Financing Prevention Act, the Credit Institutions Act, the Law of Obligations Act, and the State Fees Act into compliance with the Constitution.