EBA calls for strengthening the connection between the EU legal frameworks on AML/CFT, DGSD

Tuesday 15 December 2020 13:23 CET | News

The European Banking Authority (EBA) has published an Opinion on how to strengthen the connection between the EU legal frameworks on anti-money laundering and terrorist financing, and deposit protection.

The proposals aim at informing its ongoing reviews of the Anti-Money Laundering Directive (AMLD) and the Deposit Protection Schemes Directive (DGSD). The Opinion is addressed to the EC and the national authorities, to implement some changes already under the current legal framework and ahead of the potential future revisions of the AMLD and DGSD.

The authority assessed how information about potential money laundering or terrorist financing risks of depositors is identified and transmitted to deposit guarantee schemes (DGSs) ahead of them repaying depositors.

The EBA assessed how authorities have cooperated in such cases, and how effective such information sharing and cooperation mechanisms have been in real-life cases. The EBA also looked at how depositors, whose payout has been suspended or deferred, or who have been excluded from the payout, have been informed of their situation.

The Opinion also sets out what relevant authorities should do to minimise the risk of repaying money launderers during DGS payouts, including the requirement to ensure traceability of funds in such payouts. For the time until the EU legal framework is changed, the Opinion also indicates the type of information national authorities should receive from the failing credit institutions, and how the authorities should communicate with depositors in such cases.

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Keywords: European Banking Authority, EBA, money laundering, regulatory frameworks, AMLD, payout, fraud prevention, money launderers
Categories: Fraud & Financial Crime
Countries: Europe
This article is part of category

Fraud & Financial Crime

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