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Financial Action Task Force offers new AML and CTF advice for EU states

Thursday 3 November 2022 10:55 CET | News

The Financial Action Task Force (FATF) has issued a new set of recommendations for EU states on how to handle AML and terrorist financing threats.

 

These recommendations were first introduced in 2019 as part of the Supranational Risk Assessment Report (SNRA). Even though according to the EU’s Anti-Money Laundering Directive, the SNRA report should be updated once every two years, the update was delayed to 2022 because of the COVID-19 pandemic. 

Some areas that required a re-calculation of their risk levels included the online gambling sector, as well as crypto assets. The FATF took note of the impact that these two factors had on EU member states, particularly in the context of rising money laundering risk levels throughout businesses and economic sectors in the EU. 

The FATF study on CTF and AML threats focused on more than 40 services or products included in eight different business categories. The gambling sector stood out thanks to its fast economic growth and technological development. Moreover, the expansion of the online gambling sector recorded during and at the end of the pandemic prompted competent authorities to signal higher risks arising from online gambling since the last SNRA report in 2019. 

According to the same SNRA report, brick-and-mortar casinos continue to be subject to high-risk exposure to AML threats triggered by cash transactions. The use of cash plays an important role when it comes to ML and TF risks, as the criminal economy relies heavily on the use of banknotes. 

When it comes to online gambling, AML threats mostly apply to member states that are targeted by unauthorised online gambling operators. Anonymous e-money processing platforms and virtual currencies contribute to the problem according to the FATF, which also signalled the lack of proper feedback and reporting of suspicious solutions in the gambling sector. 

With that in mind, European financial intelligence units are advised to work on improving the quality of their reports and make better use of the information they are given. The FATF also recommends strengthening gambling AML safeguards through specialised training that focuses on appropriate risk assessments of relevant products and business models for staff, compliance officers and retailers.

 

The Financial Action Task Force (FATF) has issued a new set of recommendations for EU states on how to handle AML and terrorist financing threats.

 

The FATF also revealed guidance on AML risks in real estate 

In September 2022, the FATF  revealed new guidance on anti-money laundering (AML) risks in the real-estate sector.

The AML risk publication follows a consultation in March and April 2022, in which contributors asked for better clarity for property professionals on the risks associated with money laundering. They also asked the FATF to match its requirements so that the sector can operate with greater certainty in cross-border property transactions. 

While assessing the industry, the FATF found that there is a poor level of understanding of AML risks and how to mitigate them. The sector is most vulnerable when it comes to exploitation by politically exposed persons, the use of anonymous companies, the purchase of luxury properties, and the use of virtual assets.


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Keywords: AML, fraud prevention, gambling, risk management
Categories: Fraud & Financial Crime
Companies: Financial Action Task Force
Countries: Europe
This article is part of category

Fraud & Financial Crime

Financial Action Task Force

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