EU proposes watchdog to stop the flow of dirty money


(Reuters) – EU policymakers on Tuesday proposed a new agency to prevent financial firms from helping criminals and terrorists after a scandal at a Danish bank highlighted the bloc’s inadequate defenses .

FILE PHOTO: European Commission Vice-President Valdis Dombrovskis speaks at a press conference on money laundering as the spread of coronavirus disease (COVID-19) continues at headquarters EU in Brussels, May 7, 2020. Virginia Mayo / Pool via REUTERS

Europe came under pressure to tighten enforcement of its anti-money laundering rules when several countries began investigating Danske Bank after more than € 200 billion ($ 235 billion) in transactions suspects passed through its tiny Estonian branch between 2007 and 2015.

Danske said in April that it may be required to investigate its former Estonian branch further this year.

With no EU authority to stop billion-euro money laundering and terrorist financing, Brussels has relied on national regulators, but they have been at odds on who should be responsible and who should be responsible. have not always applied the rules consistently.

“The national territory we have to protect is the European Union,” EU chief financial officer Mairead McGuinness told reporters.

“This package will correct these shortcomings in the framework.”

The European Commission has proposed to create a European Anti-Money Laundering and Terrorist Financing Authority (AMLA) to directly oversee an as yet un-established list of cross-border financial companies considered to be the most risky, and to coordinate enforcement between national regulators. .

AMLA could also intervene in unregistered companies if the national regulator has not taken sufficient measures.

A levy on risky companies will largely fund the new body, which is expected to be fully operational by 2026 with around 250 employees, including 100 to oversee riskier companies in conjunction with national regulators.

AMLA, which will cost 45.6 million euros to operate and may impose sanctions of up to 10 million euros or 10% of a company’s annual turnover, would deprive the European Banking Authority (ABE) of its role since 2019 of coordinating the application of anti-money laundering rules.

The EBA board in 2019 closed an investigation into Danish and Estonian regulators regarding Danske Bank without explanation, even though the two national regulators were found to be in violation of EU law.


The European Savings and Retail Banking Group said it hoped the proposal would strengthen the fight against financial crime and called for clear regulation and effective sharing of responsibilities between the new EU authority and national authorities.

Danish banking lobby Finans Danmark said strong common rules were needed to tackle cross-border economic crime, but it was important to avoid duplication between AMLA and national watchdogs.

The EU package also plans to make the bloc’s anti-money laundering rules more detailed and integrate them into a single rulebook by the end of 2025 to prevent criminals from exploiting the differences between national regulators, said the Commission.

Companies managing virtual assets, such as bitcoin, would be subject to anti-money laundering rules, as well as transparency requirements for crypto asset transfers.

The European Commission has also proposed an EU-wide limit of 10,000 euros ($ 12,000) for cash transfers.

“If you allow bags full of cash to buy luxury goods, questions need to be asked about where that money comes from,” McGuinness said.

EU states and the European Parliament have the final say on the committee’s proposals in a negotiation process that can take around two years.

Additional reporting by Nikolaj Skydsgaard in Copenhagen, editing by Barbara Lewis and Giles Elgood

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