RiskFinancial CrimeEU Toughens Anti-Money Laundering Rules

EU Toughens Anti-Money Laundering Rules

An agreement reached by the European Commission (EC), European parliament and European Union (EU) member states paves the way for a tougher anti-money laundering (AML) regime. It will lead to the creation of a central register recoding the ultimate ownership of all Europe-based companies or trusts.

Owners of secretive companies in Europe will have a harder time keeping it from the public eye as the registry will be accessible to anyone with a “legitimate interest” in identifying owners, such as investigative journalists and concerned citizens – although activists had pushed for access to be made fully public.

“For years, criminals in Europe have used the anonymity of offshore companies and accounts to obscure their financial dealings,” said Krisjanis Karins, a Latvian politician and member of the European parliament, who has lobbied for the proposed law.

“Creating registers of beneficial ownership will help to lift the veil of secrecy of offshore accounts and greatly aid the fight against money laundering and blatant tax evasion.”

The agreement comes a month after the so-called ‘LuxLeaks’ scandal that exposed often secret deals that saved many of the world’s largest companies billions of dollars in taxes by routing profits via Luxembourg. The deals were made when Jean-Claude Juncker , the new president of the EC, was the country’s prime minister.

Juncker last week urged swift approval of the measure, though under the condition that access to the registry will be limited to those with a legitimate interest in accessing the information.

While financial transparency activists acknowledged the agreement represented progress, many criticised its more limited scope. “It is disappointing that amidst financial secrecy scandals and promises for more transparency, the EU fell short of allowing the public to see who is behind anonymous shell companies and trusts,” said Tamira Gunzburg, of the ONE advocacy group in Brussels.

According to the group, Germany, Spain and the UK resisted opening up the list to a broader audience, ultimately leaving it to “member states to determine who will have access to the information”.

Related Articles

Why working in silos is a killer when battling financial crimes

Cyber Security & Fraud Why working in silos is a killer when battling financial crimes

4m Andrew Simpson
PSD2: dull name, but seismic effect

Clearing & Settlement PSD2: dull name, but seismic effect

6m Alex Kwiatkowski
Staying one step ahead: PSD2 and the future of fraud

Financial Crime Staying one step ahead: PSD2 and the future of fraud

7m Seth Ruden
8 predictions for treasury in 2018

Financial Crime 8 predictions for treasury in 2018

7m Bob Stark
FDIC sues 9 European banks over Libor

Banking FDIC sues 9 European banks over Libor

11m Victoria Beckett
Appreciating supply chain cyber risk

Cyber Security & Fraud Appreciating supply chain cyber risk

11m Peregrine Storrs-Fox
The death of the password: biometric banking

Automation The death of the password: biometric banking

11m Paul Sheldon Foote
The insecurity of fraud victims in the fight against cyber-assailants

Bank Relationships The insecurity of fraud victims in the fight against cyber-assailants

11m Keiron Dalton