EU reviewing past money-laundering cases at banks in the EU
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The European Commission is reviewing past money-laundering cases at EU banks to assess what went wrong and decide possible tweaks to rules.
Under the plan, the European Commission is assessing cases between 2012 and 2018 with the aim of producing a report this summer that identifies the factors that contributed to the banks’ failure in preventing financial crime.
The review is part of a plan to improve the European Union’s approach to combating money laundering after a string of the bloc’s banks across Denmark, Estonia, Latvia, Luxembourg, Malta, the Netherlands and Cyprus were embroiled in scandals.
An EU official told Reuters that the review includes cases of lenders that have collapsed after money-laundering allegations, like Latvia’s ABLV and Malta’s Pilatus.
Though it’s normal for the EU to review industrial practices, the assessment of money-laundering cases shows the scale of the problem and the questions facing regulators, given many of the cases erupted after a series of legislative reforms.
Missions to EU states are under way, the official said, without clarifying whether reviews are conducted at the banks themselves or only with their national supervisors. The Commission declined to comment on this point.
The review is meant “to better inform possible additional actions” by the EU in strengthening its anti-money laundering tools, according to the plan published last year.
The EU has no power to impose penalties on banks over failures to prevent money-laundering.
The plan to enhance the bloc’s defenses against money laundering was adopted in December by EU finance ministers. It lists non-legislative measures that need to be carried out by 2020, although the official said there “could be delays”.
Under the plan, EU supervisors must clarify existing rules for assessing whether bank managers are fit for their job and on revoking banking licenses for serious breaches of anti- money-laundering rules.
National authorities are also requested to cooperate more closely.
The EU has largely left supervision of anti-money laundering activities in the hands of national authorities, who have been heavily criticized by lawmakers for failing to cooperate against a crime that is mostly carried out across borders.
France and Italy are among EU states pushing for the creation of an EU agency that would take over supervision powers currently held by national authorities, officials said.
The idea is backed by the European Central Bank, the International Monetary Fund and the EU Parliament’s resolutions, but many states oppose it.
