ECB clamps down on money laundering as new watchdog established

The ECB has pledged to work in tandem with the new anti-money laundering regulator to support supervisory oversight and avoid duplicating their efforts.

The Authority for Anti-Money Laundering and Countering the Financing of Terrorism (AMLA) became operational on 1 July.

Yesterday (3 July) the ECB and the AMLA signed a Memorandum of Understanding outlining how they will exchange information and collaborate on policies and standards.

AMLA will directly supervise financial institutions explicitly exposed to cross-border money laundering risks, known as ‘selected obliged entities’, such as payment institutions, crypto-asset service providers and some banks. The ECB will continue to incorporate anti-money laundering/countering the financing of terrorism (AML/CFT) into its prudential supervision of banks.

Bruna Szego, chair of AMLA, said: "For the financial system to be better protected against misuse by criminals, close cooperation between AML/CFT and prudential supervisors is essential to building a robust and consistent anti-money laundering framework across Europe.

“This MoU is a cornerstone in that effort. It establishes the foundation for meaningful information exchange and coordination that will enhance both the integrity and resilience of the financial system."

Claudia Buch, chair of the ECB’s supervisory board, added: “It is essential that prudential supervisors and anti-money laundering authorities work closely and efficiently together to strengthen the resilience of the banking sector.

“This agreement lays the foundation for structured and effective cooperation between the ECB and AMLA, allowing us to address risks in a coordinated and effective way.”

AMLA has also signed a multilateral MoU with the European Supervisory Authorities (EBA, EIOPA and ESMA) to effectively exchange information and engender co-operation.

Petra Hielkema, chair of both EIOPA and the joint committee of the ESAs, said: “The ESAs stand ready to support AMLA with all the knowledge and information at our disposal so that it can exercise its new powers to ensure illicit activities do not go undetected or unpunished on our soil.

“We look forward to a productive and efficient EU-wide collaboration with AMLA to protect the integrity of the EU’s financial system and create a safer and fairer financial environment for all.”