In view of blatant shortcomings in the fight against criminal money, the European Commission is working on a new action plan on preventing money laundering and terrorist financing in the EU. While the release initially scheduled for 25 March could be postponed due to the Corona crisis, a leak of the Commission draft action plan has been published by Politico today.
The leaked action plan calls for turning part of the European Anti-money laundering Directive (AMLD) into a directly applicable regulation, creating an EU coordination mechanism for national Financial Intelligence Units (FIU), and enhancing supervision at EU level. The Commission communication leaves open the question whether to create a new EU entity or whether the European Banking Authority (EBA) should be tasked with EU-wide supervision. A legislative proposal in this regard is announced for the first quarter of 2021. Already in March 2020, the Commission intends to publish its revised methodology for assessing third countries at high risk of money laundering, followed by the release of an updated EU blacklist.
MEP Sven Giegold, financial and economic policy spokesperson of the Greens/EFA group commented:
“The new EU Commission action plan is sending the right signal to complacent member states but is falling behind expectations. The EU can no longer tolerate its single market being abused for financial crime. The draft action plan is lacking bold statements on strengthening cross-border law enforcement. Before finalising its action plan, the Commission should urgently consider suggesting an EU financial police in the framework of Europol as requested by the European Parliament. Facing the blatant shortcomings in the national application of EU rules against money laundering, the European Commission has to apply a zero tolerance policy and urgently launch infringement proceedings for all Member States not implementing effectively EU law.
With the announced measures the European Commission is following the calls by the European Parliament to harmonise the application of EU rules on anti-money laundering and to improve cooperation irrespective of national borders. However, when presenting concrete legislative proposals beginning of next year, the Commission is asked to also close loopholes in the current legislation. Given the security risks stemming from money laundering and terrorism financing, we can no longer allow companies to hide its ultimate beneficial owners behind strawmen.”
Link to Politico leak of the EU Commission draft action plan:
https://www.politico.eu/wp-content/uploads/2020/03/Draft-AML-communication-2.pdf