(LifeSiteNews) — The Council of the European Union proposed a cash limit of 10,000 EUR for all member states of the EU in order to fight money laundering and terrorist financing.
The proposed legislation also requires providers of cryptocurrency to verify “facts and information about their customers” if they make transactions of 1,000 EUR or more.
“The EU continues its fight to protect EU citizens and the EU’s financial system against money laundering and terrorist financing,” the press release of the European Council states.
Czech Finance Minister Zbyněk Stanjura said that they intend to “close loopholes” for criminals.
“Large cash payments beyond €10.000 will become impossible,” Stanjura said. “Trying to stay anonymous when buying or selling crypto-assets will become much more difficult. Hiding behind multiple layers of ownership of companies won’t work anymore. It will even become difficult to launder dirty money via jewellers or goldsmiths.”
Whether cash limits prevent criminal activity remains questionable. In 2016, German mainstream news outlet der Spiegel reported that European countries like Portugal, Greece, Spain, and Belgium had already introduced cash limits, some of them much lower than 10,000. However, there was no noticeable reduction in criminal activity or the “shadow economy” in these countries.
The “shadow economy” flourished much more in these countries than in Germany, where there was no cash limit at the time.
Der Spiegel quotes Green Party financial expert Gerhard Schick, who said the cash limit is “an absolute sham” and it does “not help in the slightest” to “cut off terrorists’ means of subsistence or arms deals.”
According to der Spiegel, “neither the mafia nor terrorists nor international arms or drug traffickers probably rely on walking around with bundles of banknotes,” since “they have their own money transfer systems.”
Furthermore, “anyone can set up anonymous shell companies for a small fee – anywhere in the world,” and “pay through them by check, credit card or bank transfer,” and be in complete compliance with the law.
“Notaries and lawyers also offer anonymous accounts through which black money can be transacted,” der Spiegel wrote.
Many fear that anonymous cash is being slowly abolished and replaced by digital currencies. In Nigeria, the government recently limited cash withdrawals in order to push people into using the Central Bank’s digital currency, which the Central Bank also plans to link to a digital ID system.
READ: Nigeria limits cash withdrawals as part of aggressive push toward digital-only currency system