British officials, she added, would have much greater success if European laws were harmonised.
"If you opt in there is an immense amount more that could be recovered," she said.
"I have seen figures showing that you [in Britain] recover £150 million to £200 million a year, but that's still a fraction of what it could be.
"It's important to get the money so crime doesn't pay. In times of crisis it's also important to get all the money back for the taxpayer that we can."
Under the EU proposals, which could come into force next year, "extended confiscation" laws would grant authorities the power to seize goods not linked to a specific offence but which result from similar activities by a criminal.
The new rules would make it easier to freeze money linked to organised crime and widen the range of funds covered by laws, Ms Malmström said.
Further powers to toughen laws to seize property transferred to third parties, including wives, are also being developed.
Stronger rules on the temporary freezing of suspects' property would also be introduced to prevent huge sums of money being lost before the courts can act.
Prosecutors may seize funds before seeking a court order and would still be able to pursue convicted people even after they served their sentence.
The proposals were announced by the European Commission last month in order to "better equip national authorities by sharpening and improving the tools at their disposal".
Ms Malmstrom added: "We need to hit criminals where it hurts, by going after the money, and we have to get their profits back in to the legal economy.
"Every day … citizens are deprived of tax money which could have been invested in public services such as health care or schools, or … returned to people through tax cuts.
"Organised crime is all about getting money, money and more money that can be turned into gold, houses, yachts, racing horses, luxury furniture, fancy cars, motorbikes and any sort of assets."
Latest European Commission statistics showed that British officials recovered just £125 million in 2006 from an estimated £15 billion in profits generated by organised crime.
Meanwhile, according to EU figures, trafficking in illicit drugs generates more than 100 billion euros (£82.5 billion) in profits alone every year.
Last month it was disclosed that more than 100 so-called "Mr Bigs", including fraudsters, drug smugglers and gang bosses, have failed to pay back large sums of illegal assets despite being ordered to do so by the courts.
Figures released under the Freedom of Information Act showed that at least £14.3 million in legal aid went to 49 of the crime lords over the past three years.
The 49 millionaire individuals are on a Crown Prosecution Service list of 191 criminals ordered by the courts to pay back £1 million or more in illicit profits.
Most have failed to do so, leaving taxpayers owed a total of £584 million, the London Evening Standard reported.
Last year the Home Secretary, Theresa May, announced that a new "FBI-style" crime agency would take responsibility for organised and economic crime.
The National Crime Agency (NCA), which is to replace the Serious Organised Crime Agency (SOCA), would put right a "patchy ... response" to dealing with organised crime.
She said its creation was vital to thwart crime gangs who cost the economy up to £40 billion per year.
Up to 38,000 people and 6,000 gangs were operating throughout Britain but only 11% were being hit "in a meaningful way", she added.
In January, Keith Bristow, the new director-general of the NCA, said stripping the most dangerous criminals of their assets would help protect the public.
Mr Bristow, the Chief Constable of Warwickshire, will take over the new agency when it opens next year.
On Thursday night, a Home Office spokesman said: "The Proceeds of Crime Act is a hugely effective tool in ensuring that crime does not pay.
"Last year alone we recovered or deprived criminals of more than £1 billion assets and ill got gains."
A SOCA spokesman did not respond to inquiries for comment.