EU Commission’s AML-CTF Action planMay 2020
On 7 May 2020, the European Commission adopted an action plan for a comprehensive and harmonised EU policy on preventing money laundering and terrorist financing. The action plan is to be founded on six pillars:
By Judy de Castro - Regulatory Consultant
- Pillar One: Effective implementation of existing rules
- Pillar Two: A single EU rulebook
- Pillar Three: EU-level supervision
- Pillar Four: A support and cooperation mechanism for financial intelligence units
- Pillar Five: Information exchange to enforce criminal law provisions
- Pillar Six: A stronger EU AML-CTF Framework
The Commission intends to deliver on all these actions by early 2021. To gather the views of citizens and stakeholders on these measures, the Commission launched a public consultation which will close on 29 July 2020.
The action plan builds on the findings of the anti-money laundering package of 2019, which highlighted serious shortcomings including major divergences in the way rules are applied and enforced by the various EU members states, uneven supervision and limitations in the cooperation among financial intelligence units across the EU.
For those entities under the scope of the AML/CTF framework, or designated persons, the measures to take note of are those set out in Pillars two and three. Pillar two’s main objective to limit divergences in interpretation and application of relevant rules will include provisions laying down a harmonised approach to customer due diligence requirements, a ceiling for large cash payments and reporting obligations.
Pillar three is about enhanced integration of supervision through an EU body, namely the European Banking Authority (EBA) for direct supervision over designated persons empowered to review internal policies, procedures and controls including documentation on transactions and customers.
Click HERE to view the Action Plan.