EU Parliament Approves Sweeping Anti-Money Laundering Regulations

The European Parliament has voted overwhelmingly to adopt a comprehensive package of anti-money laundering regulations aimed at combating financial crime and terrorist financing across the European Union. The centerpiece of the new rules is a ban on cash payments exceeding 10,000 euros, which will apply to all member states.

In addition to the cash payment limit, the regulations introduce enhanced due diligence requirements for banks, cryptocurrency providers, estate agents, and other entities deemed at high risk for money laundering. These "obliged entities" will be required to verify the identity of their customers and report any suspicious transactions to national financial intelligence units.

The legislation also establishes a new EU-level anti-money laundering agency, the Authority for Anti-Money Laundering and Countering the Financing of Terrorism (AMLA), which will be based in Frankfurt. AMLA will directly supervise the 40 financial institutions considered to pose the greatest money laundering risks and work with national authorities to ensure compliance across the bloc.

Why this matters: The EU's financial system has been rocked by a series of high-profile money laundering scandals in recent years, damaging its reputation on the global stage. The new regulations represent the most significant overhaul of the bloc's anti-money laundering framework in decades and are seen as vital to restoring trust and cracking down on illicit finance.

The rules will take effect gradually over the next three years, with some flexibility granted to certain sectors like football. "These new rules will help us track down criminals and terrorists who attempt to launder dirty money in Europe," said Finnish MEP Eero Heinäluoma, who led the Parliament's work on the legislation. "No longer will they be able to exploit loopholes and weak links in our financial system."

Key Takeaways

• EU Parliament approves comprehensive anti-money laundering regulations
• Key measure: Ban on cash payments exceeding €10,000 across EU
• New rules impose enhanced due diligence on high-risk entities
• Establishes EU-level anti-money laundering agency (AMLA) in Frankfurt
• Aims to restore trust and crack down on illicit finance in EU