After numerous major money laundering scandals, now comes the EU proposal for a joint fight against money laundering throughout Europe, including an Anti-Money Laundering Authority! We have received internal documents from the European Commission on its planned legislative package against money laundering and terrorist financing. According to these documents, the legislative package comprises four proposals:
- The most important provisions of the existing anti-money laundering directive will be transferred into a regulation and expanded by more detailed provisions. This means that uniform standards against money laundering will apply in the EU when the new regulation comes into force. Unlike a directive, a regulation does not first have to be transposed into national law.
- The existing fourth EU Anti-Money Laundering Directive and its 2018 extension (AMLD5) will be repealed and replaced by a new directive. This directive will address the issues not covered by the regulation under point 1. The provisions go beyond the existing ones in many respects.
- An Anti-Money Laundering Authority will be established in the EU. The draft of this regulation provides for a new type of governance structure that strengthens the independence of the new EU supervisory authority vis-à-vis the interests of the member states.
- The third regulation in the Commission’s legislative package regulates the providers of crypto-assets such as Bitcoin and Co. This extends the due diligence requirements that are already commonplace for bank transfers to crypto-assets.
The proposals are to be adopted by the EU Commission on 20 July. They then need the approval of the European Parliament and the Council of Member States.
MEP Sven Giegold, financial and economic policy spokesperson of the Greens/EFA group commented:
“The European Commission’s proposals are a major step forward against money laundering. The project strengthens our European internal market against organised financial crime. Our years of campaigning for effective measures against organised crime are now paying off. The planned regulations would create a common legal basis and effective anti-money laundering supervision in Europe. The package is capable of creating the necessary uniform standards against money laundering in Europe. The proposal is also another major step towards a strong Europe. After joint banking supervision and the European Public Prosecutor’s Office, we are once again getting closer to a Europe with strong common institutions.
The European Commission addresses known weaknesses in the fight against money laundering and proposes ambitious solutions. However, these planned measures must not further delay the implementation of existing rules. We need a zero-tolerance policy by the Commission towards the implementation deficits of anti-money laundering rules by member states. Uniform standards can only be effective if the EU Commission ensures their seamless application throughout Europe with the help of infringement proceedings. After all, the lion’s share of supervisory activity will continue to take place in the member states and regions. This legislative package must come with a new spirit in the European Commission with regard to infringements. In the Commission’s Action Plan last year, enforcement of EU law was at the top of the agenda. We still see too little of this in practice.
With the establishment of an EU authority, the EU Commission is fulfilling a long-standing demand of the Greens. For me personally, this is a great success after years of campaigning for a joint fight against financial crime in the EU. With the new Anti-Money Laundering Authority we get effective supervision at EU level. The new EU supervisor can directly control banks if there is a high risk of money laundering. The envisaged governance structure is a big step forward compared to the structure of other European Supervisory Authorities: The executive board is to be staffed exclusively with independent experts, six in total. This means that the common interests of the EU are given centre stage and the influence of member states is limited. This is important, because consistent action against money laundering is often inconvenient for the supervisory authorities at national level. Strong and coordinated measures against organised crime are crucial to protect the rule of law. The attack on investigative journalist Peter de Vries is a harrowing example of this. However, the new authority will only be able to intervene diretly in the financial sector, not in other areas such as jewellers or art dealers. Here, too, the risk of money laundering can be high.
In addition to money laundering supervision, law enforcement must also be better coordinated across Europe in the future. The confiscation of funds and the conviction of criminals is still far too slow. We Greens therefore call for the establishment of a European Criminal Office based on the achievements of Europol. That would be the next big step.
The proposals also rightly include a limit on cash payments over 10,000 euros. 99% of citizens are not affected by this. Cash is economic data protection that nobody wants to abolish. But very high cash transactions promote financial crime and are therefore already restricted in most EU countries. Common minimum standards in all EU countries make sense and also protect neighbouring countries.”
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