On September 10, the European Banking Authority (EBA) published its response to the European Commission’s March 2020 call for advice on the EU’s future anti-money laundering (AML) and countering the financing of terrorism (CFT) framework (the Response).
The EBA’s key recommendations, so as to achieve a single rulebook, in its Response are to:
- harmonize the EU’s legal framework (to eradicate the diverse national approaches across the EU) and adopt EU AML and CFT law into national law relating to customer due diligence and wider AML and CFT systems and controls requirements. The EBA further recommended harmonization of the rules governing key supervisory processes, including money laundering and terrorism financing (ML and TF) risk assessments, co-operation and enforcement;
- strengthen aspects of the EU’s Fourth Money Laundering Directive where existing provisions lack robustness and create weaknesses in the EU’s AML/CFT defences;
- examine the scope of the EU’s AML/CFT legislation in relation to the list of obliged entities to ensure they are well-defined and in line with international AML/CFT standards; and
- clarify provisions in sectoral financial services legislation to ensure consistent application with the EU’s AML/CFT objectives. This further includes ensuring ML and TF risk is addressed consistently throughout all sectors and supervisory process.
The Response is available here.