EBA launches consultation on money laundering, terrorism financing in the EU

The European Banking Authority (EBA) has introduced a public consultation on a database on anti-money laundering and countering terrorism financing (AML/CFT) in the EU.

The consultation on draft Regulatory Technical Standards will run until 17 June 2021 and will specify the definition and existence of weaknesses identified by relevant authorities, the kind of information collected, as well as how such information will be communicated to the EBA.

Furthermore, the draft will aim to set out how the banking authority will analyse and distribute the information contained in the AML/CFT central database. In the consultation, the rules will be set out to enable the database effectiveness, data confidentiality, how the database will interact with other notifications authorities are required to give to the EBA and protection provisions of personal data.

According to the EBA, the database will be a key tool for its recently enhanced mandate to lead, monitor and coordinate AML/CFT efforts across the EU. Following new regulation that came into effect in January of last year, the authority is required to establish and keep up with a database on AML/CFT weaknesses identified by competent authorities across the EU.

The database will also include information on the measures authorities have taken to deal with the AML/CFT weaknesses. This information will be used by individual authorities as well as the EBA to more effectively target money laundering and terrorism financing in the EU going forward.

The EBA said, “The AML/CFT central database will be a key tool in coordinating efforts to prevent and counter ML/TF in the Union. It will serve as an early warning tool to enable the competent authorities to act before the ML/TF risks crystalise and help them plan their on-site inspections and perform off-site monitoring.”

The Monetary Authority of Singapore (MAS) recently imposed a penalty of S$1m on a Singapore-based bank branch for not complying with its AML/CFT acts.

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