The torrents of AML-CFT guidance pouring down on ‘obliged entities’ | AML, CFT, AML package

At present, Europe is pouring out a cascade of directives, instructions and reports on the financial sector in regard of fighting crime (‘anti money laundering’, AML, and ‘countering of terrorism’, CFT). An example of a creator of this cascade is banking supervisor EBA, that recently published guidelines on role and responsibilities of the AML/CFT compliance officer.

Once the rules of the AML package have come into force, the waterfall will pour down on all companies that are supposed to fight crime, in which AMLA will play a central role.

Text of the announcement of the EBA-guidelines:

EBA publishes Guidelines on role and responsibilities of the AML/CFT compliance officer

The European Banking Authority (EBA) today published its Guidelines specifying the role and responsibilities of the anti-money laundering and countering the financing of terrorism (AML/CFT) compliance officer and of the management body of credit or financial institutions. These Guidelines aim to ensure a common interpretation and adequate implementation of AML/CFT internal governance arrangements across the EU in line with the requirements of the EU Directive on the prevention of the use of the financial system for the purposes of money laundering or terrorist financing (ML/FT).

These Guidelines set clear expectations on the role, tasks and responsibilities of the AML/CFT compliance officer and the management body. They specify that credit or financial institutions should appoint one member of their management body who will ultimately be responsible for the implementation of the AML/CFT obligations and clarify the tasks and functions of that person. They also describe the roles and responsibilities of the AML/CFT compliance officer, when this person is appointed by the management body pursuant to the proportionality criteria. When the credit or financial institution is part of a group, the Guidelines prescribe that a group AML/CFT compliance officer should be appointed and clarify this person’s tasks and responsibilities.
These Guidelines aim to create a common understanding, by competent authorities and credit or financial institutions, of credit or financial institutions’ AML/CFT governance arrangements. They complement but do not replace relevant guidelines issued by the EBA on wider governance arrangements and suitability checks.

Legal basis and background
The EBA drafted these Guidelines in line with its legal mandate to lead, coordinate and monitor the EU financial sector’s fight against money laundering and terrorist financing (ML/TF).
In drafting these Guidelines, the EBA fulfills a Commission’s request in its Supra-National Risk Assessment (SNRA) of 2019 to develop guidance that ‘clarifies the role of AML/CFT compliance officers in credit and financial institutions’.
Sound AML/CFT governance arrangements are key to fulfilling the private sector’s gatekeeper role and therefore to prevent and fight ML/TF. Despite the specific requirements of Directive (EU) 2015/849 to establish and implement sound internal policies, controls and procedures institutions, past evidence revealed differences in the interpretation, as well as uneven implementation, of such provisions across Member States in the EU. This could have adverse consequences for the integrity of the EU’s financial system.

Over Ellen Timmer

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