European Council adopted a new directive on combating money laundering by criminal law. The directive introduces new criminal law provisions that will disrupt and block access by criminals to financial resources, including those used for terrorist activities. The Directive shall enter into force on the twentieth day following that of its publication in the Official Journal of the European Union. Once the directive is published in the Official Journal, member states have up to 24 months to transpose it into national law.
This directive complements, on the criminal law aspects, the directive on the prevention of the use of the financial system for money laundering or terrorist financing (ML/TF), which was formally adopted in May 2018. The new rules include the following:
- Establishing minimum rules on the definition of criminal offences and sanctions relating to money laundering. Money laundering activities will be punishable by a maximum term of imprisonment of four years; judges may impose additional sanctions and measures (for example: temporary or permanent exclusion from access to public funding and fines). Aggravating circumstances will apply to cases linked to criminal organizations or for offences conducted in the exercise of certain professional activities.
- The possibility of holding legal entities liable for certain money laundering activities, which can involve a range of sanctions (for example: exclusion from public aid, placement under judicial supervision, and judicial winding-up)
- Removing obstacles to cross-border judicial and police cooperation by setting common provisions to improve investigations. For cross-border cases, the new rules clarify which member state has jurisdiction and how those member states involved cooperate, as well as how to involve Eurojust. Eurojust is an EU agency dealing with judicial cooperation in criminal matters among agencies of the member states.
- Press Release
- Directive on ML by Criminal Law (PDF)
- ML/TF Directive Adopted on May 2018
- Overview on Eurojust
Effective Date: OJ + 20 Days
Keywords: Europe, EU, Banking, AML/CFT Directive, Criminal Law Provisions, European Council
Previous ArticleESMA Updates List of Guidelines Under Its Mandate in November 2018
EU published Directive 2021/338, which amends the Markets in Financial Instruments Directive (MiFID) II and the Capital Requirements Directives (CRD 4 and 5) to facilitate recovery from the COVID-19 crisis.
The Standing Committee of the European Free Trade Association (EFTA) recommended that a systemic risk buffer level of 4.5% for domestic exposures can be considered appropriate for addressing the identified systemic risks to the stability of the financial system in Norway.
In a recent statement, PRA clarified its approach to the application of certain EU regulatory technical standards and EBA guidelines on standardized and internal ratings-based approaches to credit risk, following the end of the Brexit transition.
In a recently published letter addressed to the G20 finance ministers and central bank governors, the FSB Chair Randal K. Quarles has set out the key FSB priorities for 2021.
EU published, in the Official Journal of the European Union, a corrigendum to the revised Capital Requirements Regulation (CRR2 or Regulation 2019/876).
ESAs published a joint supervisory statement on the effective and consistent application and on national supervision of the regulation on sustainability-related disclosures in the financial services sector (SFDR).
EC published a public consultation on the review of crisis management and deposit insurance frameworks in EU.
HKMA announced that enhancements will be made to the Special 100% Loan Guarantee of the SME Financing Guarantee Scheme (SFGS) and the application period will be extended to December 31, 2021.
EBA launched consultations on the regulatory and implementing technical standards on cooperation and information exchange between competent authorities involved in prudential supervision of investment firms.
BoE issued a letter to the CEOs of eight major UK banks that are in scope of the first Resolvability Assessment Framework (RAF) reporting and disclosure cycle.