European Banking Authority AML/CFT Guidelines

Nicola Sharp of Rahman Ravelli summarises the EBA’s consultation on its efforts to tackle money laundering and terrorism financing

The European Banking Authority (EBA) has begun a public consultation in relation to anti-money laundering and combating the financing of terrorism (AML/CFT).

The consultation relates to the EBA’s new Guidelines that set out how prudential supervisors, AML/CFT supervisors and financial intelligence units (FIUs) should cooperate and exchange information regarding AML/CFT, in line with provisions laid down in the Capital Requirements Directive (CRD). The consultation will run until 27 August, 2021.

In a statement announcing the consultation, the EBA stated that: “Cooperation and information exchange is key to ensuring the prudential soundness and viability of institutions, to protecting the EU’s financial system from financial crime and to safeguarding its stability and integrity.’’

In accordance with Article 117(5) of the CRD, prudential supervisors, AML/CFT supervisors and financial intelligence units (FIUs) must cooperate closely within their respective competences and provide each other with information relevant for their respective tasks under the CRD, Regulation (EU) No 575/2013 and Directive (EU) 2015/849. This, however, should only be done providing that any such cooperation and exchange of information does not impinge on any ongoing inquiry, investigation or proceedings.

The EBA Guidelines put in place the practical methods of cooperation and information exchange among prudential supervisors, AML/CFT supervisors and FIUs, both at Member State level and across the European Union Single Market.

Clarity

The EBA believes the Guidelines provide clarity on what information should be exchanged with whom, and at what stage. They are intended to help authorities exchange information more effectively. 

The Guidelines facilitate and support the cooperation and information exchange throughout the supervisory life cycle covering authorisations of new institutions, on-going supervision including the risk assessment, and, where relevant, the imposition of supervisory measures and sanctions (which can include the withdrawal of authorisation).

Each authority has its own role and responsibilities in the fight against money laundering and terrorist financing. But the EBA is emphasising that there are areas where their tasks complement each other - making effective cooperation and information exchange an essential part of identifying, addressing and mitigating the risks and of ensuring the stability of the financial system as a whole.

The latest Guidelines complement the ESAs’ AML/CFT Colleges Guidelines, which were published two years ago.