General climate and recent developments

State of legal development

In general terms, how developed are the laws on money laundering, terrorism financing and fraud in your jurisdiction?

Greek legislation concerning money laundering, terrorism financing and fraud covers most aspects of such criminal behaviour. The relevant legislation also provides effective procedural measures to secure evidence or assets which are subject to confiscation.

Recent developments

Have there been any notable recent developments in relation to anti-money laundering, terrorism financing or fraud law and enforcement, including any regulatory changes, case law and convictions?

A number of major money laundering cases are currently pending trial. These cases mostly involve acts of fraud or corruption in relation to defence programmes and the supply of medical equipment. There has also been an increasing number of investigations concerning acts of corruption and money laundering which have come to the attention of the prosecuting authorities through:

  • mutual assistance requests (from other jurisdictions); or
  • investigations into possible acts of tax evasion or money laundering.

This has led to a broad – and sometimes excessive – use of the instruments provided for in legislation on combating economic crimes and money laundering (eg, unlimited access to bank and tax records and freezing orders on any assets, including those unconnected to the acts under investigation).

Legal and enforcement framework

Domestic legislation

What primary and secondary legislation applies to money laundering, terrorism financing and fraud in your jurisdiction?

Law 4557/2018 is the main legislative instrument against money laundering and terrorism financing.

In addition, Article 187A(6) of the Criminal Code establishes terrorist financing as a felony punishable with a custodial sentence of up to 10 years.

The main provisions against fraud are found in Articles 386 et seq of the Criminal Code. Other forms of fraud include securities fraud (Law 4443/2016), accounting fraud (Law 4174/2013) and government-contracting fraud (the general provision for fraud applies in connection with special Law 1608/1950 on financial crimes against the state).

To whom does the legislation apply? May both individuals and organisations be held liable under the legislation? Does the legislation have extraterritorial effect?

Criminal liability lies with natural persons; there is no criminal liability in its traditional sense for legal entities. For the purposes of applying legal provisions concerning wrongful corporate practices and activities, there are administrative penalties and fines, depending on the seriousness of the act and the size of the business.

In principle, criminal legislation applies to all crimes committed in Greece. Greek criminal laws also apply to acts committed in a foreign country, provided that the dual criminality requirement is fulfilled and there is a connection to Greece (ie, either the perpetrator is a Greek citizen or the crime was committed against a Greek citizen or the Greek state.

International agreements

Is your jurisdiction a party to any international cooperation agreements to combat money laundering, terrorism financing and fraud?

Greece is a signatory to the following conventions (although this is a non-exhaustive list):

  • the European Convention on Mutual Assistance in Criminal Matters;
  • the Convention of the Council of Europe on Laundering, Search, Seizure and Confiscation of the Proceeds from Crime;
  • the UN Convention against Transnational Organised Crime;
  • the UN Convention against Corruption; and
  • the Council of Europe Convention on Laundering, Search, Seizure and Confiscation of the Proceeds from Crime and on the Financing of Terrorism.

Further, Greece is a member of the Financial Action Task Force, the Financial Intelligence Unit Network and the Egmont Group through the Hellenic Financial Intelligence Unit. It is also an EU member state and a member of the European Council and cooperates with all major international bodies and organisations concerning the combating of money laundering and fraud.

Enforcement authorities

Which government authorities enforce the law on anti-money laundering, terrorism financing and fraud, and what is the extent of their powers?

The Prosecutor’s Office is tasked with criminal law enforcement. All enforcement agencies (eg, the Hellenic Financial Intelligence Unit, the Financial and Economic Crime Unit and the Capital Market Commission) forward their findings and information gathered on suspicious activities to the Prosecutor’s Office. The prosecutor evaluates the material and initiates the necessary proceedings. Large-scale crimes or offences relating to public officials are undertaken by the economic crime prosecutor, who is a prosecutor with the Athens Appeal Court and may initiate any proceedings that they deem appropriate or request for pending case files to be handed to them for further processing. As a general rule, enforcement agencies have the power to collect information, report their findings and proceed with necessary investigative acts. However, the prosecutor coordinates all such activity. In cases of emergency, certain powers are given to the Hellenic Financial Intelligence Unit for securing traced assets (eg, the proceeds of crime or money laundering or terrorism financing activities), whereby the head of the Hellenic Financial Intelligence Unit issues a freezing order to prevent loss or further concealment of property. These orders are also reviewed by the prosecutor and, if necessary, following a request by the interested party, by a judicial council. In criminal cases that are opened on the initiative of the Anti-Corruption Prosecutor’s Office, enforcement lies with the latter. The Anti-Corruption Prosecutor’s Office has the power to coordinate other enforcement agencies, request their assistance and supervise any investigation.

Statute of limitations

What is the limitation period for bringing actions in relation to money laundering, terrorism financing and fraud offences?

The statute of limitations for felonies such as money laundering, terrorism financing and serious fraud is 15 years from when the offence was committed. This period is suspended for five years when the case file is forwarded to a trial hearing. Where the act is characterised as a misdemeanour (which would apply to some cases of fraud), the statute of limitations is five years and can be suspended for three years when the case is forwarded to a trial hearing.

Offences

Legal definition

How are ‘money laundering’, ‘terrorism financing’ and ‘fraud’ legally defined in your jurisdiction?

Law 4557/2018 is the main anti-money laundering law. Article 2 of the law defines ‘money laundering’ as:

  • knowingly converting and transferring property assets that are the proceeds of crime, participating in such an act for the purposes of concealing the illegal sources of such assets or aiding anyone involved in said acts in order to help them avoid legal penalties;
  • concealing and covering up the truth, by any means, in relation to the source, movement, disposal of assets, the place of acquiring such assets or asset-related rights or knowledge that a property is associated with the proceeds of criminal acts or participation in criminal activities; 
  • acquiring, possessing, managing or using any asset with the knowledge that at the time of possession or management such property was the proceeds of a criminal activity;
  • using the financial sector by depositing or transferring proceeds of criminal activities for the purposes of making it appear as though they have legitimate sources;
  • forming a group or organisation for the purposes of committing one or more of the abovementioned actions; or
  • participation in, association to commit, attempt to commit and aiding, abetting, facilitating and counselling the commission of any of the abovementioned actions.

According to Article 187B(6) of the Criminal Code, ‘terrorism financing’ is providing any kind of financial assets (tangible or intangible, movable or immovable) or any kind of economic means, to a terrorist organisation or a terrorist to form a terrorist organisation or convince someone to become a terrorist.

Under Article 386 of the Criminal Code, fraud is perpetrated by an individual enriching itself or a third party by knowingly representing untrue facts as true or illegally concealing or suppressing true facts to persuade another party to act or omit to act, thus causing pecuniary damage. The party’s intent to enrich itself or a third party is required.

Principal and secondary offences

What are the principal and secondary offences in relation to money laundering, terrorism financing and fraud?

Law 4557/2018 is the main anti-money laundering law. Article 2 of the law defines ‘money laundering’ as:

  • knowingly converting and transferring property assets that are the proceeds of crime, participating in such an act for the purposes of concealing the illegal sources of such assets or aiding anyone involved in said acts in order to help them avoid legal penalties;
  • concealing and covering up the truth, by any means, in relation to the source, movement, disposal of assets, the place of acquiring such assets or asset-related rights or knowledge that a property is associated with the proceeds of criminal acts or participation in criminal activities; 
  • acquiring, possessing, managing or using any asset with the knowledge that at the time of possession or management such property was the proceeds of a criminal activity;
  • using the financial sector by depositing or transferring proceeds of criminal activities for the purposes of making it appear as though they have legitimate sources;
  • forming a group or organisation for the purposes of committing one or more of the abovementioned actions; or
  • participation in, association to commit, attempt to commit and aiding, abetting, facilitating and counselling the commission of any of the abovementioned actions.

These acts are punishable by a custodial sentence ranging from five to 20 years.

Article 187B(6) of the Criminal Code stipulates that the act of providing any kind of financial assets (tangible or intangible, movable or immovable) or any kind of economic means, to a terrorist organisation or a terrorist to form a terrorist organisation or convince someone to become a terrorist is punishable by a custodial sentence of up to 10 years.

Under Article 386 for the Criminal Code, fraud is perpetrated by an individual enriching itself or a third party by knowingly representing untrue facts as true or by illegally concealing or suppressing true facts to persuade another party to act or omit to act, thus causing pecuniary damage. The party’s intent to enrich an individual or a third party is required. Fraud is punishable by a custodial sentence of up to 10 years, which can be substantially increased in aggravating circumstances, especially when it is directed against the state’s financial interests.

Predicate offences

How are predicate offences defined?

Article 4 of Law 4557/2018 contains a list of predicate offences for money laundering. The list contains all forms of classic corruption and property-related offences, namely:

  • bribing domestic public officials;
  • bribing foreign or EU officials;
  • fraud;
  • tax evasion and tax fraud;
  • capital market offences, including offences related to insider trading;
  • antiquities trafficking;
  • environmental offences;
  • drug trafficking;
  • people trafficking;
  • organised crime; and
  • terrorism financing.

Tax evasion is also listed as a predicate offence. Moreover, the list contains a general provision according to which any offence that results in assets or property and is punishable by law with a minimum of six months imprisonment may be considered a predicate offence. In other words, all criminal activities that produce money or asset gains or profits are considered to be predicate offences. The list of predicate offences is non-exhaustive, as it leaves room for any type of criminal behaviour that results in profit, even if it is of lesser to medium importance (it also includes misdemeanours punishable by imprisonment of less than one year).

De minimis rules

What de minimis rules apply to money laundering, terrorism financing and fraud offences?

Money laundering requires that a natural person acts in the knowledge of the criminal source of the assets and for the purposes of concealing or covering up their true origin. Therefore, there is no room for negligently committing a punishable act of money laundering.

Terrorism financing requires that assets are transferred in the knowledge that they will be used by  a terrorist or terrorist organisation.

Fraud requires that a person is misled by misrepresentations to act or omit to act, thus causing pecuniary damage. The perpetrator of the offence must act with intent to enrich itself or a third party.

Penalties and plea agreements

Penalties

What penalties may be issued for money laundering, terrorism financing and fraud offences?

The penalties for money laundering are up to 20 years’ imprisonment and a fine of up to €2 million. The penalty for terrorism financing is up to 10 years’ imprisonment.

The penalties for fraud depend on the legal character of the offence. A misdemeanour can mean five years’ imprisonment, whereas a felony (serious cases of fraud) can mean 10 years’ imprisonment. If a serious case of fraud is committed against the financial interests of the state and serious damage exceeding €150,000 is suffered, a penalty of up to 20 years’ or life imprisonment in the most serious cases may be imposed.

Plea agreements

Are plea agreements available? If so, how often are they used and what rules, standards and procedures apply?

Greek legislation does not provide for plea agreements. However, through a series of recent amendments to the Criminal Code (to comply with obligations from international treaties and other instruments), there is a provision for immunity or leniency in respect of money laundering relating to corruption acts. Under Article 263(B) of the Criminal Code Procedure, charges against a defendant for bribery, corruption or money laundering may be suspended if they give evidence of corrupt acts committed by government members. If charges cannot be brought against government members or members of parliament (eg, due to limitation), the person offering evidence is eligible for a lesser penalty. The court may even decide to suspend execution of the penalty.

Defences

Available defences

What defences are available in your jurisdiction to parties accused of money laundering, terrorism financing or fraud?

As there are no strict rules of evidence under Greek law and no provisions for strict criminal liability, there are no specific defences regarding money laundering. As a matter of practice, the basic defence  arguments against money laundering charges deal with the soundness of the charges in respect to the source of assets and the defendant’s knowledge of the specific offence (which resulted in the illegal profit).

General criminal defence arguments (eg, lack of knowledge) apply to terrorism financing.

In the case of fraud, a defendant may argue that:

  • the alleged untrue facts were true or were simple (false) promises;
  • there was a lack of intent by the defendant to enrich itself; or
  • there was no financial loss as a result of the alleged fraudulent behaviour.

Record keeping, disclosure and compliance

Record-keeping and disclosure requirements

What record-keeping and disclosure requirements apply to companies and relevant individuals under the anti-money laundering, terrorism financing and fraud legislation?

A suspicious activity indicates that a money laundering offence is being committed or has been attempted or that the transacting party is involved in prior criminal activity (predicate offences). In such cases, an assessment must be made considering:

  • the characteristics of the transaction;
  • the background of the client (financial or professional); and
  • a history of the client’s transactions.

Diligence rules apply to transactions over €15,000. Suspicious transactions must be reported promptly to the Hellenic Financial Intelligence Unit, along with all relevant information that the unit requests. The Ministry of Finance has issued a series of circulars regarding the application of anti-money laundering laws and regulations and bookkeeping obligations, whereby auditors and accountants are given specific guidelines to report to the Hellenic Financial Intelligence Unit any transaction that raises suspicion of being related to a criminal act (even if it is a simple or general suspicion without need for proof).

Compliance

What internal compliance measures are required and/or advised for companies in relation to the anti-money laundering, terrorism financing and fraud legislation?

All covered institutions and persons need to implement anti-money laundering compliance programmes, usually following the guidelines and regulations of the competent supervising authorities. Naturally, covered institutions that are more vulnerable to money laundering activities (eg, banks, financial institutions and insurers) have more comprehensive and detailed anti-money laundering compliance programmes, especially as they are strictly supervised and regulated. The minimum elements of an anti-money laundering compliance programme (which may vary depending on the nature of the covered institution or person) concern validating the transaction as much as possible and identifying transacting parties in order to eliminate suspicions of questionable conduct or unknown, untraceable origins of assets. However, even individual professionals (eg, lawyers and notaries) must meet the standards set by the competent supervising authority (eg, the Ministry of Justice and bar associations and associations) regarding the management of trusts or transactions on a client’s behalf.

What customer and business partner due diligence is required and/or advised for companies in relation to the anti-money laundering, terrorism financing and fraud legislation?

Law 4557/2018 outlines a complex set of diligence rules for covered persons to follow, which are applicable to:

  • new clients;
  • existing clients;
  • high-risk individuals;
  • politically exposed persons;
  • transactions on new financial products; and
  • transactions executed without the client’s physical presence.

Rules of diligence apply when:

  • covered institutions enter into a business agreement with the client or process occasional transactions of more than €15,000;
  • there is suspicion that an offence has been committed or is about to be committed; and
  • there is doubt about the accuracy of information obtained to confirm and verify the identity of the client or another person acting on behalf of the client.

According to the rules of ordinary diligence, covered institutions must:

  • verify the identity of the client and the beneficial owner in relation to the executed transaction; and
  • gather information on the client’s economic background to check whether a transaction matches their background.

The methods that a financial institution use to make the required cross references must be able to identify the individuals, transaction and beneficiary owner.

Article 3(17) of Law 4557/2018  defines ‘beneficiary ownership’ as the person in favour of whom a transaction is executed or the person in control of an entity or a group of entities (directly or indirectly) in favour of which a transaction is executed. The main issue is finding who benefits eventually from the transaction.

Covered institutions must conduct risk-based analysis when a transaction concerns politically exposed persons (eg, government members, members of parliament, heads of state, directors of central banks, ambassadors and high-ranking members of the judiciary). Stricter rules of diligence also apply to transactions without the presence of the client, cross-border transactions and transactions relating to new financial products or the use of new technology. Covered institutions must take additional measures to avoid the execution of a suspicious transaction and if they cannot verify a transaction’s basic elements they must abstain from executing it, especially if there is suspicion of a connection with organised crime or terrorism activities.

Private enforcement

Private actions

Can private actions be brought in your jurisdiction for damages arising from money laundering, terrorism financing or fraud? If so, who may file such actions and what filing procedures apply?

Civil claims may be brought against money launderers, covered institutions and persons under the general provisions of civil law. The person or entity seeking compensation and filing a civil suit may make a claim against the person or entity employing the person responsible for damage incurred by money laundering acts. There are no financial thresholds to consider for such a claim to be admissible. Limitation of the civil claim depends on its legal basis. If the basis is tort, the limitation period is that of the criminal act of money laundering. The plaintiff must prove that the acts of the persons or entities constitute a breach of law, regulation or good practice and are linked to the damage.

A victim of fraud may file an action in tort against the defendant in the competent first-instance court seeking restitution of the loss or damage sustained (Article 914 et seq of the Civil Code). There is no fixed claim form and the content of an action in tort is determined by the plaintiff, provided that it meets the requirements set out in Articles 118 and 216 of the Code of Civil Procedure. To this effect, an action in tort should at least contain:

  • the names and addresses of the litigants;
  • the court to which it is addressed; 
  • the particulars of the claim or the factual allegations that, if proved, would establish the action against the defendant; and
  • the prayer for relief sought.

For monetary claims, the action should also contain a statement of value. For an action in tort to be granted in favour of the plaintiff, they should expressly allege that the defendant acted wilfully or negligently and that the damage sustained was caused by the defendant and was a result of, in the normal course of actions, their tortious acts or omissions.

On the date of filing of the action, the court schedules the hearing date. A court bailiff then serves the action on the defendant. Once the court reaches its ruling, it is publicly announced and delivered in the form a decision, granting or dismissing the action, in whole or in part. A right of appeal is always provided to the defeated party.

How are damages calculated?

Damages are calculated based on the claimant’s statement of value made in the civil action, the evidence submitted to substantiate their claim and the defendant’s counterclaims, arguments and evidence.

What other remedies may be awarded to successful claimants?

The Greek courts generally order an unsuccessful litigant to pay the costs of the proceedings, which, as a rule, are of nominal value and cover a small part of the actual costs incurred by the successful party. Parties of limited financial resources can avoid legal costs based on Articles 194 to 204 of the Code of Civil Procedure.