DEVLHON Consulting Deciphers: Preparing for the Entry into Force of AMLA

DEVLHON Consulting Deciphers: Preparing for the Entry into Force of AMLA

Context and Objectives of AMLA

The fight against money laundering and terrorist financing (AML/CFT) is a priority for financial authorities worldwide. In Europe, this fight is taking a crucial step forward with the entry into force of the European Anti-Money Laundering Authority (AMLA). This new entity aims to harmonize and strengthen AML/CFT measures at the European level, ensuring more coherent and centralized supervision. AMLA was created as part of the anti-money laundering legislative and regulatory package adopted in 2023. Its primary objective is to directly supervise the highest-risk financial institutions at the European level, to improve the consistency and effectiveness of AML/CFT measures.

Preparations of Financial Institutions

Financial institutions must actively prepare for the entry into force of AMLA. They are enhancing their internal compliance systems to ensure they meet the new European standards. This includes improving processes for detecting and reporting suspicious activities, as well as implementing enhanced training for staff. Internal policies and procedures are being reviewed to ensure they align with AMLA requirements, with the implementation of more stringent controls and the documentation of compliance processes. Additionally, advanced technologies, such as artificial intelligence and machine learning, are increasingly being used to detect suspicious activities and improve the efficiency of surveillance systems.

Role of the ACPR in the Transition

The Autorité de Contrôle Prudentiel et de Résolution (ACPR) plays a crucial role in preparing for the entry into force of AMLA. The ACPR is actively involved in preparatory work to ensure a smooth transition to the new supervisory framework. This includes collaborating with other European regulators to harmonize supervision requirements and practices. In 2023, the ACPR intensified its efforts to oversee crypto-asset service providers. The Transfer of Funds Regulation (TFR) imposes new requirements to ensure that crypto-asset transactions are transparent and traceable, thus reducing money laundering risks. The ACPR has updated its sectoral risk analysis to incorporate market practice developments and new players, particularly in sensitive sectors like fund transfers and crypto-assets.

Challenges and Perspectives

The implementation of AMLA and the associated new regulations represents a considerable challenge for financial institutions. They must comply with stricter requirements, which may necessitate significant investments in human and technological resources. Compliance costs can be high, especially for smaller financial institutions. However, these costs are essential to ensure the stability and security of the financial sector. Integrating advanced technologies into compliance systems can be complex and requires adequate staff training.

Conclusion

The entry into force of AMLA marks a crucial step in the fight against money laundering and terrorist financing in Europe. Ongoing preparations, both at the level of financial institutions and regulators like the ACPR, are essential to ensure a smooth and effective transition to this new supervisory framework. In the long term, these efforts will help strengthen the resilience and transparency of the European financial sector, thereby ensuring better protection against financial and criminal risks.