The European Commission has adopted a Communication and four reports that will support European and national authorities in better addressing money laundering and terrorist financing risks.
Supranational risk assessment of the money laundering and terrorist financing risks affecting the Union.
The supranational risk assessment report is a tool to help Member States identify and address money laundering and terrorist financing risks. It is adopted every two years by the Commission.
The Commission calls upon Member States to:
implement the recommendations from this report urgently: improving cooperation among supervisors, providing updated guidelines on internal governance and providing further guidance on beneficial ownership identification for investment funds providers;
implement the fourth Anti-Money Laundering Directive, in line with the Council conclusions of 4 December 2018;
transpose the fifth Anti-Money Laundering Directive by 10 January 2020.
Report assessing the framework for Financial Intelligence Units' (FIUs) cooperation with third countries and obstacles and opportunities to enhance cooperation between Financial Intelligence Units within the EU
The assessment showed that some Financial Intelligence Units failed to engage in a meaningful dialogue by giving quality feedback to obliged entities defined by the fifth Anti-money laundering directive. The lack of templates for reporting also hampers the quality of the reports by obliged entities. Several Financial Intelligence Units do not fully comply with their obligation to exchange information with other Financial Intelligence Units. The recurrent technical difficulties in the functioning of the FIU.net seem to have been an important factor in these difficulties. The report also shows a need for a stronger mechanism to coordinate and support cross-border cooperation and analysis. The unregulated information exchange between Member States' FIUs and the FIUs of third countries led to a different approaches to such exchanges.
Report assessing the conditions and the technical specifications and procedures for ensuring secure and efficient interconnection of central bank account registers and data retrieval system
In this report the Commission assesses the conditions, technical specifications and procedures for ensuring a secure and efficient interconnection of the centralised bank account registries or data retrieval systems. Looking at the various IT solutions ensuring the EU-wide decentralised interconnection of national electronic databases, already operational or being currently under development, this report delivers a short factual analysis of the available technical options, highlighting their benefits or drawbacks. The report also identifies where one or another option is most suitable for a possible future interconnection of the national bank account registries. The report will inform EU decision makers about a future interconnection project. It is a legal basis for the establishment of an EU-wide interconnection.
Report assessing recent alleged money-laundering cases involving EU credit institutions
The analysis has identified four categories of shortcomings:
ineffective or lack of compliance with the legal requirements for anti-money laundering/counter terrorism financing systems and controls;
governance failures in relation to anti-money laundering / counter terrorism financing;
misalignments between risk appetite and risk management;
ineffective supervision of group anti-money laundering / counter terrorism financing policies.
The Commission also found that Member States do not apply the rules in the same way, which makes it difficult to prevent money laundering and terrorist financing.
The report concludes that:
banks failed to comply with core requirements of the Anti-Money Laundering Directive, such as risk assessment, customer due diligence, and reporting of suspicious transactions and activities to Financial Intelligence Units.;
public authorities only intervened after significant risks had occurred or when faced with repeated compliance and governance failures. Bank supervisors' reacted in different ways in terms of timing, and the measures taken. Cooperation between national supervisors and the European Central Bank merits further improvement.
Overall, the reports stress the need for their full implementation while underlining that a number of structural shortcomings in the implementation of the Union's anti-money laundering and counter terrorist financing rules still need to be addressed.
This package will serve as a basis for future policy choices on how to further strengthen the EU anti-money laundering framework.