European Banking Authority
AML/CFT - EBA publishes round 2 report on NCAs’ approaches to bank supervision - 22 March 2022
The European Banking Authority (EBA) has published a report (EBA/REP/2022/08) detailing the second round of its findings from its assessment of national competent authorities’ (NCAs’) approaches to the anti-money laundering and countering the financing of terrorism (AML/CFT) supervision of banks. The first and second round of the reviews took place in 2019 and between 2020 and 2021 respectively.
In round two, review teams assessed seven NCAs from seven EU/EEA member states and made recommendations tailored to each NCA. In line with round one of the reviews, the EBA found that all NCAs sampled had undertaken significant work to implement a risk-based approach to AML/CFT. Significantly, since round one, awareness of the synergies that exist between AML/CFT and prudential supervision has increased, and supervisory cooperation has become a clear focus for all NCAs sampled. The EBA highlights that AML/CFT teams in almost all NCAs have grown significantly and are set to expand further.
The report notes challenges in operationalising the risk-based approach to AML/CFT. A number of challenges are common to all NCAs and include: (i) identifying money laundering and terrorist financing (ML/TF) risks relating to the banking sector; (ii) translating ML/TF risk assessments into risk-based supervisory strategies; (iii) using available resources effectively, including by ensuring sufficiently intrusive onsite and offsite supervision; and (iv) taking proportionate and sufficiently dissuasive enforcement measures to correct AML/CFT compliance weaknesses. The EBA also highlights that cooperation with national financial intelligence units was largely ineffective in most sampled EU member states but notes that several NCAs have started to take steps to address this.
Round three of the reviews is now underway. As part of this, the EBA will follow up with NCAs from rounds one and two on steps they have taken since to strengthen their approaches to AML/CFT supervision.
EBA Report: On competent authorities’ approaches to the anti-money laundering and countering the financing of terrorism supervision of banks (round 2 - 2020/21) (EBA/REP/2022/08)
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HM Treasury
AML/CTF controls in overseas jurisdictions - HM Treasury updates advisory notice - 17 March 2022
HM Treasury has updated its advisory notice on anti-money laundering (AML) and counter-terrorist financing (CTF) controls in high-risk third country jurisdictions under the Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017. The updated advisory notice takes into account two statements published by the Financial Action Task Force on 4 March 2022, identifying jurisdictions with strategic deficiencies in their AML and CTF regimes.
The notice identifies Albania, Barbados, Burkina Faso, Cambodia, the Cayman Islands, DPRK, Haiti, Iran, Jamaica, Jordan, Mali, Malta, Morocco, Myanmar, Nicaragua, Pakistan, Panama, the Philippines, Senegal, South Sudan, Syria, Turkey, Uganda, United Arab Emirate and Yemen as countries for which appropriate actions should be taken to minimise the associated risks and these actions may include enhanced due diligence in high-risk situations. Zimbabwe is no longer subject to the Financial Action Task Force’s increased monitoring process due to its significant progress in improving its AML/CFT regime.
HM Treasury advisory notice on AML and CTF controls in high-risk third country jurisdictions
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