The fourth EU anti-money laundering directive
The final version of the fourth EU anti-money laundering directive was enacted in June 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 fourth EU anti-money laundering directive takes into account the latest recommendations of the Financial Action Task Force (“FATF”) from 2012. The directive was finalised and adopted at a European level in June 2015 giving member states until June 2017 to transpose the directive into national legislation.
The new directive outlines a number of modifications to the third EU anti-money laundering 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 and procedures – Data protection
- Record keeping
- Definition of “Senior Management”
- Financial intelligence unit