European legislators have taken various steps in recent years to strengthen the link between anti-money laundering/countering the financing of terrorism (AML/CFT) and prudential issues.
Some things matter to you, even if you are not directly responsible
for them. At the European Central Bank (ECB) it is not part of our tasks
to supervise banks’ compliance with rules to prevent money laundering
and terrorist financing. Yet money laundering and terrorist financing
risks pose a danger to the sustainability of banks and can seriously
damage people’s trust in the banking sector. This is why we really need a
strong European anti-money laundering authority. It would also help us
as prudential supervisors, because banks that struggle with issues in
this area often suffer from structural deficiencies in their internal
controls and governance arrangements, which do fall within the scope of
ECB Banking Supervision.
European legislators have taken various steps
in recent years to strengthen the link between anti-money
laundering/countering the financing of terrorism (AML/CFT) and
prudential issues. For example, prudential supervisors can now use the
information held by AML/CFT authorities in authorisation procedures,
when taking decisions about the suitability of management bodies, or as
part of ongoing supervision. Similarly, AML/CFT authorities use the
information shared by prudential supervisors.
We warmly welcome the proposal
from the European Commission published last July to set up an EU AML
Authority (AMLA). This will help to ensure that AML/CFT rules are
applied more effectively and consistently across countries. The creation
of this new authority matters to us, as banking supervisors, since AMLA
and the ECB will need to cooperate in several areas to ensure efficient
and effective supervision. Benefiting from the experience gained in
building European banking supervision in the last decade, we have
identified three main areas which in our view are key to ensuring the
authority at the centre of this new EU-wide supervisory authority is
well designed, as reflected in the ECB Opinion published today.
A wide scope of direct supervision
A strong and credible European anti-money laundering authority
should directly supervise a sufficiently large number of entities from
the outset. And this pool should include entities headquartered in each
of the Member States to ensure that supervisory practices are aligned.
Our experience of building European banking supervision taught us that adopting significance criteria
to include banks in all participating countries is essential to create a
common approach to prudential supervision. This ensures that every
national competent authority makes a substantial contribution to the
ECB’s direct supervisory tasks. It also ensures that EU-level prudential
supervision is present in each country, at consolidated and individual
level. With that, the ECB has gained a thorough understanding of the
banking sector across the entire banking union and has identified good
practices across the EU...
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