EBA revised its guidelines on ML/FT risk factors

  • Richard Marley
  • February 06, 2020
  • 2 minutes read
  • 1737

The European Banking Authority (EBA) issued revised money laundering and terrorist funding (ML/TF) risk factors as a part of comprehensive AML/CFT concerns. 

This new update reckons changes to the EU Anti-Money Laundering and Counter-Terrorism Financing (AML/CFT) legal framework.

The revised guidelines are for the EBA’s to lead the work, regulate and monitor the fight against money laundering and terrorist funding. The guidelines are addressed to both financial institutions and supervisors, setting out the factors that must be considered while assessing the ML/TF risks associated with ongoing transactions or business relationships.

These new amendments in the guidelines assist the financial institutions to conduct customer due diligence (CDD) and enhanced due diligence (EDD) related to high-risk customers and countries to mitigate the ML/TF risks. 

In its revised version, EBA has added new sectorial guidelines for crowdfunding platforms, payment initiation service providers (PISPs), corporate finance, account information service providers (AISPs), and currency exchange firms.

This update public consultation provides more details on the ML/TF risk factors and the CDD measures. It includes the identification of the ultimate beneficial owners, using advanced solutions to verify the customers’ identity, and setting clear regulatory expectations for both individual and business risk assessments. 

It is believed that the proposed changes will strengthen the EU’s AML/CFT measures to combat financial crimes.