On 22 March 2022, the European Banking Authority (EBA) published the findings from its assessment of Member State competent authorities’ (NCAs) approaches to anti-money laundering and countering the financing of terrorism (AML/CFT) supervision, but the EBA has found that significant challenges remain in key areas such as the identification and assessment of money laundering (ML) and terrorist financing (TF) risks.
Among other things the EBA identifies that supervisory cooperation has become a clear focus for all NCAs, and all NCAs have started to put in place mechanisms to exchange information with other relevant authorities at home and abroad such as memoranda of understanding and AML/CFT colleges. Common challenges faced by NCAs include difficulties relating to the identification and assessment of ML/TF risks associated with the banking sector and with individual banks within that sector (particularly terrorist financing risk), translating ML/TF risk assessments into risk-based supervisory strategies; using available resources effectively, including by ensuring sufficiently intrusive on-site and off-site supervision; and taking proportionate and sufficiently dissuasive enforcement measures to correct AML/CFT compliance weaknesses. The EBA also found that cooperation with financial intelligence units was not always systematic and continued to be largely ineffective in most Member States in this year’s sample, though several competent authorities had started to take steps to address this.