Combating fraud and counterfeiting of means of payment

Table of Contents:

Combating fraud and counterfeiting of means of payment

Outline of the Community (European Union) legislation about Combating fraud and counterfeiting of means of payment

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These categories group together and put in context the legislative and non-legislative initiatives which deal with the same topic.

Internal market > Single market for services > Financial services: banking

Combating fraud and counterfeiting of means of payment

Document or Iniciative

Council Framework Decision 2001/413/JHA of 28 May 2001 on combating fraud and counterfeiting of non-cash means of payment.

Summary

The aim of this framework decision is to supplement a series of other measures already taken by the Council on combating fraud and counterfeiting of non-cash means of payment:

  • Joint Action 98/428/JHA on the creation of a European Judicial Network;
  • Joint Action 98/733/JHA on making it a criminal offence to participate in a criminal organisation in European Union (EU) countries;
  • Joint Action 98/699/JHA on money laundering, the identification, tracing, freezing, seizing and confiscation of instrumentalities and the proceeds from crime.

Under this framework decision, fraud involving any form of non-cash means of payment will be recognised as a criminal offence that is punishable by effective, proportionate and dissuasive penalties in all EU countries.

Criminal offences

The framework decision deliberately avoids references to specific offences under the existing criminal law because they do not cover the same elements everywhere. Instead, the framework decision merely lists the various types of behaviour that should be criminal offences throughout the Union. Different types of behaviour are defined on the basis of whether they are directed at the payment instrument itself or the making of payment instruments, one or more payment transactions or the system itself for ordering, collecting, processing, clearing and settling payment transactions.

Penalties

All the types of behaviour mentioned above are to be classified as criminal offences in all EU countries. This means that the latter must provide for penalties for these offences, depending on whether natural or legal persons commit them. Penalties must be effective, proportionate and dissuasive. They will not necessarily involve deprivation of liberty, except in the most serious cases, which may give rise to extradition. EU countries will have some discretion in determining the gravity of an offence and the nature and severity of the penalties that apply.

Jurisdiction

A series of criteria has been established to determine the jurisdiction of the national judicial authorities in respect of the offences referred to in the framework decision. An EU country will establish its jurisdiction where an offence is committed:

  • on its territory;
  • by its nationals (where extraterritorial jurisdiction is recognised by the EU country);
  • for the benefit of a legal person having its headquarters in the competent EU country.

Provision has also been made for offenders to be prosecuted in cases where an EU country does not extradite its own nationals.

Cooperation

Arrangements have been put in place to ensure that the public and private bodies that manage, monitor and oversee payment systems cooperate with the national authorities responsible for investigating the offences described in the framework decision and taking action against the perpetrators. Additional cooperation mechanisms may be set up between EU countries in accordance with the conventions, bilateral or multilateral agreements or any other arrangements that apply. The Commission will report to the Council on EU countries’ compliance with the provisions of the framework decision.

This act is affected by Case C-176/03 of the Court of Justice of the European Union regarding the distribution of powers in criminal matters between the Commission and the Council.

References

Act Entry into force Deadline for transposition in the Member States Official Journal
Framework Decision 2001/413/JHA

2.6.2001

2.6.2003

OJ L 149 of 2.6.2001

Related Acts

Report from the Commission of 20 February 2006 – Second report based on Article 14 of the Council Framework Decision of 28 May 2001 combating fraud and counterfeiting of non-cash means of payment [COM(2006) 65 final – Not published in the Official Journal].

Report from the Commission of 30 April 2004 based on Article 14 of the Council Framework Decision of 28 May 2001 combating fraud and counterfeiting of non-cash means of payment [COM(2004) 346 final – Not published in the Official Journal].

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