According to part I of the annual report for 2024 the European Banking Authority (EBA) had a focus on the transition to the new AML/CFT framework (page 6):
Through 2024, the EBA continued to lead, coordinate and monitor the EU financial sector’s AML/CFT efforts. As part of this, it continued to set common standards in line with its legal mandate where warranted and necessary, highlighted and acted upon emerging ML/TF risks, and supported the effective implementation of robust approaches to tackling ML/TF, sanctions and other financial crime risk across the EU.
Work to deliver the EBA’s mandates in Regulation (EU) 2023/1113 on information accompanying transfers of funds and certain crypto-assets (the Funds Transfer Regulation – FTR) was a particular focus. In 2024, the EBA issued:
– Guidelines on the so-called ‘travel rule’, i.e. the information that should accompany transfers of funds and certain crypto-assets. These guidelines, which were issued in July 2024, serve to tackle the abuse of such transfers for ML/TF purposes. They updated and replaced guidelines on the travel rule that the EBA had issued in 2017.
– Two sets of guidelines on internal policies, procedures and controls to ensure the implementation of EU and national sanctions. These guidelines, which were issued in November 2024, set out, for the first time, common EU standards on governance arrangements, and on the policies, procedures and controls that financial institutions should have in place to be able to comply with EU and national restrictive measures.
– A public consultation launched in December 2024 on draft technical standards specifying the criteria according to which crypto-asset service providers (CASPs) should appoint a central contact point to ensure compliance with local AML/ CFT obligations of the host Member State. These RTS amend the RTS the EBA had issued previously, by extending their scope to CASPs.
In addition, the EBA worked to include specific provisions on identifying and tackling ML/TF risks in 10 MiCA instruments, and published an ‘explainer’ to provide a comprehensive overview of the holistic approach to tackling ML/TF risk in crypto to an emerging sector.
The EBA continued to monitor and disseminate information on emerging ML/TF risks and coordinated CAs’ actions where necessary to tackle those risks. This included:
– Using the EBA’s EuReCA database to inform CAs of risks that were relevant to them concerning individual institutions under their AML/CFT supervision, and concerning their overall approaches to tackling ML/TF risk. For example, submissions suggested that across the EU, ML/TF risks associated with the ineffective use of RegTech solutions were increasing. By the end of 2024, EuReCA contained information on 2 542 material weaknesses and corrective measures concerning 517 institutions submitted by 44 CAs from all Member States.
– Assessing the risks and impact of the use of virtual IBANs (vIBANs) and publishing the findings in a report in April 2024. The report highlighted the lack of a common definition at EU level and divergent approaches, both by CAs and by the industry, which raise challenges not only from an AML/CFT perspective, but also from consumer and depositor protection, authorisation and passporting, and regulatory arbitrage perspectives. The EBA provided recommendations in that respect.
– Hosting meetings of EU supervisors to coordinate actions and ensure a robust approach to tackling crystallised ML/TF risks in individual CASPs. Over the course of 2024, the EBA hosted three such meetings, in addition to advice it also provided on tackling ML/TF risk in specific situations. As a result of the EBA’s work, CAs reassessed the fitness and propriety of senior managers and beneficial owners in three cases, and triggered other supervisory actions in seven cases.
– Raising awareness of specific risks it had identified by publishing factsheets for financial institutions on terrorist financing and derisking.
As was the case in previous years, the EBA continued to support the effective implementation of its standards through targeted reviews and training. In 2024, the EBA:
– Completed its reviews of EU/EEA CAs’ approaches to tackling ML/TF risk in the banking sector. By December 2024, the EBA had assessed all 40 CAs in the EU and provided them with feedback and recommendations for change where necessary. For the final round of reviews, as set out in a report the EBA published in December 2024, the EBA found that AML/CFT supervisors had taken important steps to implement a risk-based approach to AML/CFT, but that challenges continued to exist in relation to prudential supervision and risk assessments in particular. The EBA will now conduct a final stocktake of all the actions taken by CAs in response to the EBA’s recommendations and publish a final report in 2025 as part of the EBA’s handover to AMLA.
– Continued to monitor the effective functioning of AML/CFT colleges. The fourth report on the functioning of AML/CFT colleges, which was published in December, highlights that AML/CFT colleges worked well in the period under review, but further progress was necessary in two areas: adjusting the functioning of AML/CFT colleges to specific ML/TF risks to which the underlying firm is exposed, and discussing the need for a common approach or joint action.
– Provided training to 350 staff from CAs on crypto, EuReCA, and on the effective assessment of ML/TF risk.
The EBA worked closely throughout 2024 with CAs and the Commission to prepare for the transition to the EU’s new legal and institutional AML/CFT framework. The publication of the new AML/CFT package in June 2024 started a transition period whereby the EBA continues to be responsible for AML/CFT until 31 December 2025 while the new AML/CFT Authority, AMLA, is being set up. As part of this, the EBA has started to prepare the transfer of data, knowledge and powers to AMLA, supported national CAs in their preparatory work to adjust to the new framework, and contributed to safeguarding effective cooperation between prudential and AML/CFT supervisors and regulators in future.
An important aspect of this work relates to the preparation of the EBA’s response to a Call for Advice the EBA received from the Commission on 12 March. In this Call for Advice, the Commission tasks the EBA with the preparation of several technical standards that will be key to the new AML/CFT regime. The EBA is due to respond to the European Commission by the end of October 2025. Specifically, the Commission asked the EBA to prepare a common ML/TF risk assessment methodology for AML/CFT supervisors in line with Article 40(2) of the Sixth AntiMoney Laundering Directive (AMLD6) and the methodology that the AMLA will use to select institutions that will be directly supervised by it pursuant to Article 12(7) of AMLA. The EBA’s input will also cover customer due diligence aspects under Article 28(1) of AMLR and the criteria that supervisors will use to determine pecuniary sanctions or administrative measures under Article 53(10) AMLD6 and to consider possible guidance on the base amounts for such sanctions under Article 53(11) AMLD6. The EBA organised an industry roundtable in October 2024 to obtain the views of the private sector on these mandates with a view to informing its approach. A consultation was launched in Q1 2025.
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