February 24, 2024
EU on verge of new money laundering rules

Officials hope the amended laws will draw a line under a series of dirty money scams


EU negotiators are reaching an agreement on historic new anti-money-laundering laws – potentially bringing restrictions on large cash payments and citizenship for payments.

The bloc is keen to draw a line under a series of dirty money scandals – but its plans are not without their controversy.

New laws could improve the EU’s poor reputation for fighting illicit finance.

Two EU members – Croatia and Bulgaria – are currently on a derogatory “grey list” of suspected money laundering jurisdictions compiled by the international standard-setting Financial Action Task Force (FATF), where they join Haiti, Syria and Yemen.

The region has been affected by several financial sector scandals, including Danske Bank’s processing of hundreds of billions of dollars of dirty Russian money through its Tallin branch and the collapse of Pilatus Bank in Malta – a country that spent a year on the FATF list. Had also spent. ,

The talks have been given added urgency because of the need to prevent Russia from evading war-related sanctions and after several years in which the bloc was plagued by terrorist violence backed by questionable finance.

For the first time, EU anti-money laundering rules are set out in a regulation directly affecting all 27 members, making them both easier to comply with, and more effective in tackling cross-border flows.

Early next week (11 and 12 December), representatives of the European Parliament, the Council of the EU which groups member governments, and the Commission will present their planned reform in closed-door meetings, known as the Trilogue. Is.

Yet time is running out to finalize an agreement under the current EU Council presidency, which Spain will hand over to Belgium at the end of December.

cash and culture

Negotiators appear to have already agreed to extend the law to artwork dealers, meaning they would have to carry out bank-style identity checks on their customers.

This is because the illegal artefact trade can be used to finance crime and terrorism – groups such as ISIS are profiting from looted archaeological remains in Iraq and Syria.

An EU document prepared for the November 14 triumvirate meeting seen by Euronews shows that the new rules could affect a wide range of intermediaries dealing with high-value cultural goods, including archaeological objects, manuscripts and musical instruments. Are.

Lawmakers are also set to ban the use of cash for large transactions – preventing people from buying valuables such as real estate with wads of notes.

But there is disagreement over whether to set the limit at €10,000 or lower, while some lawmakers are concerned that mandating digital payments raises concerns over privacy, accessibility and cybersecurity.


MEPs have said their plans will help stop billions of euros of dirty money flowing out of the EU economy.

“These measures mark the beginning of the end for criminals, terrorists, oligarchs, art ‘enthusiasts’ and crooked football agents,” Damian Carem, the lawmaker who led the regulation through the European Parliament’s Civil Liberties Committee, said in a March statement. “

Yet several elements of the legislative deal have still not been paid off – including Careem’s plan to impose money-laundering checks on football clubs.

A planned new EU anti-money laundering agency would oversee dirty-money controls at about 40 major banks, but next week’s talks are unlikely to decide which of nine candidate cities will host it, according to talks. A source with information told Euronews.


MEPs also need to convince the Council to ban citizenship-by-investment, which grants a passport to anyone with the right level of wealth.

“Lawmakers are right that this sector needs to be regulated,” Roland Pape of Transparency International told Euronews, adding that so-called golden visas “risk money laundering and corruption.”

They have the backing of the FATF, which in a November report highlighted a network of “criminal, negligent, or colluding” real estate agents and money managers who often support the schemes.


But Papp, who is the pressure group’s senior policy officer on illicit financial flows, said tackling dirty money also needed to shine a light on the true ownership of companies, trusts and other foreign legal structures.

It was thrown into disarray by what Papp called a “disastrous” ruling by the EU’s highest court last year.


In a shock ruling in November 2022, judges said publishing information on corporate ownership could put the ultra-rich at risk of fraud or extortion.

Negotiators now need to figure out how to make that data available to those with a legitimate interest in tracing dirty money, such as journalists and civil society pressure groups.

This will likely take place as part of parallel negotiations on a new anti-money laundering directive – a separate legal instrument that gives national governments more flexibility – but Papp is convinced of its benefits.

“It’s not just about fighting money laundering,” Papp said, adding that beneficial ownership data can also help fight against tax fraud, organized crime and illegal logging. “There are a number of areas where this information is part of the puzzle.”

Source: www.euronews.com

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