The earlier EFIU’s internal risk assessments and the findings of the NRA 2020/21 had indicated that the risk systems of Estonian CSPs are generally weak, due diligence measures are insufficiently implemented and only a very few service providers fulfill the obligation to report suspicious transactions to the EFIU.
The EFIU’s survey on CSPs revealed that the services that enable a measure of anonymity to the CSPs’ customers (company formation combined with wholesale type sales of shelf companies with activity licenses; use of CSP’s address as a legal address; indications of acting as nominal directors, nominal shareholders or fictitious beneficial owners) are widespread and increasingly orientated to international market, especially the sale of ready-made companies with VASP license. However, the Estonian CSPs do not appear to provide trust services. There is a considerable number of unlicensed private individuals and legal entities whose activities bear the characteristics of factual provision of services. The EFIU intelligence indicates that a few service providers (there are both licensed and unlicensed CSPs among them) have criminal ties and they may be part of a larger international money laundering infrastructure.
The survey concludes that the CSPs currently decrease Estonian corporate transparency and increase the risk that Estonian legal persons are being misused for criminal purposes.
The full text of the survey can be found HERE (1.23 MB | pdf).