The Fourth EU Anti Money Laundering Directive
The final version of the Fourth EU AML Directive is expected to be enacted in early 2015. The purpose of the Directive is to remove any ambiguities in the previous legislation and improve consistency of anti-money laundering (AML) and counter terrorist financing (CTF) rules across all EU Member States.
The 4th AML Directive takes into account the latest recommendations of the Financial Action Task Force (“FATF”) from 2012. Once the Directive has been finalised and adopted at a European level, there will be a two year period within which it will be required to be transposed into national legislation.
The new Directive outlines a number of modifications to the Third EU AML Directive, and has been welcomed overall by the industry. The primary modifications relate to the areas of:
- Risk Based Approach
- Ongoing Monitoring
- Beneficial Ownership
- Customer Due Diligence (CDD)
- Politically Exposed Persons (PEPs)
- Third Party Equivalence
- Policies & Procedures – Data Protection
- Record Keeping
- Definition of “Senior Management”
- Financial Intelligence Unit