NEW GUIDANCE HAS BEEN PROPOSED BY THE EUROPEAN UNION’S BANKING REGULATOR  TO RENOVATE ITS ANTI MONEY-LAUNDERING SYSTEM

Karimi & Associates Law Firm presents according to Wall Street Journal:

The proposal from the Paris-based European Banking Authority is the latest effort by the EU to harmonize anti-money-laundering rules across member states and shift implementation away from national authorities.

Some member states already have similar anti-money-laundering laws, however, this new proposal should be helpful to financial institutions and their compliance officers due to its thoroughness and specificity.

The proposed guidance would require one member of a financial institution’s management board to be responsible for the company’s anti-money-laundering program in particular although the rest of the board would also carry responsibility.

It also describes the responsibilities of anti-money-laundering compliance officers, including in the areas of conducting due diligence on customers and reporting suspicious transactions to relevant authorities. According to the proposal, compliance officers should report directly to the company’s management board.

In the guidance, it has been placed great emphasis on the requirement for banks to designate a group compliance officer who is responsible for harmonizing a financial institution’s approach to anti-money-laundering rules across member states.

The European Banking Authority mentioned that it had investigated money-laundering scandals and came to the conclusion that one cause was a lack of reporting lines between institutions’ local offices and their group management bodies.

A London-based Lawyer, Jasper Helder, explained that the above–mentioned requirement places part of the responsibility for developing a consistent EU-wide approach to anti-money-laundering standards on financial institutions themselves.