Aug 21 2009 Direct News
Bulgaria needs to develop new anti-money laundering (AML) laws as the country is currently losing around 3 billion lev (£1.32 billion) a year to economic crime, the head of the Financial Intelligence Agency (FIA) has said.
Nikolay Ivanov said the two main types of financial crime affecting the eastern European state are VAT fraud and the "grey economy", Sofia-based news agency novinite.com reports.
The grey economy involves the use of legal, but unofficial, channels for the buying and selling of goods.
Ivanov cited research from Bulgarian thinktank the Center for the Study of Democracy estimates that between 25 per cent and 35 per cent of the Bulgarian economy is currently within the "grey" sector.
He called for new AML legislation to restore the FIA powers to its pre-2002 levels.
"After 2002, when it was stripped of the power to reveal crimes and the obligation to alert the prosecutor's office only if there was a suspected crime, the FIA turned into a mailbox, or rather an archives bureau," Ivanov commented.
According to a recent study by AT Kearney and Visa Europe reported by the Sofia Echo, as much as 37 per cent of Bulgaria's GDP falls under the "grey economy".
This compares with around ten per cent in the UK.
