European Banking Authority Publishes Opinion on Relation of Prudential Objectives to Anti-Money Laundering and Counter-Terrorism Financing

The European Banking Authority has published an Opinion signaling the importance of money laundering and terrorism financing risks in the prudential supervision of EU Member States. The Opinion invites national prudential supervisors to make clear to institutions in their jurisdictions the expectation that prudential supervisors should be aware of AML/CTF risks that may affect the institutions they oversee. The Opinion also invites supervisors to notify institutions that AML/CTF concerns will be taken into account in determining prudential supervision. The exchange of information between prudential supervisors and national regulators responsible for AML/CTF supervision is encouraged. The Opinion makes clear that it remains the responsibility of institutions to mitigate AML/CTF risks by ensuring, for example, the competence and character of members of management and that governance and risk management processes are adequate.

The EBA's Opinion is published in the wake of recent action taken by EU legislators to strengthen prudential responses to AML/CTF risks. This includes amendments to the Capital Requirements Directive that impose new requirements upon prudential supervisors to help combat AML/CTF risks and the Council of the European Union's publication of the Anti-Money Laundering Action Plan.

View the EBA's Opinion.

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