The European Union’s (EU) Sixth Money Laundering Directive (6AMLD) came into effect a little over a month ago. This means there are now less than six months left until it must be implemented by financial institutions and other obliged entities on 3 June 2021.
The message from 6AMLD is clear: personal accountability will be held for non-compliance.
With the clock ticking, now is the time to protect yourself both personally and professionally by getting AML systems, policies and procedures into shape.
What is 6AMLD?
As the world grapples to get money laundering under control, 6AMLD is the EU’s toughest ever measure to deter money laundering.
6AMLD will discourage criminals and their associates from laundering money by subjecting money laundering in all Member States to effective and proportionate criminal penalties. If 6AMLD works as intended, these penalties will be significant enough to make those involved think twice. 6AMLD aims to criminalise money laundering when it is committed intentionally and with the knowledge that the property came from criminal activity.
Who does 6AMLD effect?
6AMLD affects all financial institutions and obliged entities operating in the EU. Obliged entities include banks, all types of financial institutions, accountants, lawyers, real estate agents, virtual assets such as cryptocurrencies, virtual asset service providers such as digital wallets and high value art traders.
What about 6AMLD, the UK and Brexit?
The UK and Ireland are not taking part in the adoption of this directive. The UK Government states: “The UK’s domestic legislation is already largely compliant with the Directive’s measures, and in relation to the offences and sentences set out in the Directive, the UK already goes much further”.
What are 6AMLD’s key changes?
6AMLD ends years of ambiguity and inconsistency by clearly defining money laundering offences and sanctions. This harmonised definition is integral to facilitating police and judicial cooperation between EU countries.
6AMLD also closes loopholes and more lenient legal systems that criminals have been exploiting for years.
The directive further recognises that in order to use criminal law to effectively tackle money laundering, it is essential to have swift and efficient cross-border cooperation. This means 6AMLD requires Member States to assist each other in the widest possible way, and ensure information is exchanged in an effective and timely manner.
Why is 6AMLD necessary?
AML efforts have not been effective enough. It has been too easy for criminals to launder money and get away with it. It has also been too easy for others to be actively, or even indirectly, involved in money laundering without incurring the personal risk and liability you might expect .
Part of the problem was the fact that the criminalisation of money laundering had not been sufficiently coherent. This left enforcement gaps and barriers to cooperation between the relevant authorities in different member states.
How can I comply with 6AMLD?
To comply with 6AMLD, your organisation will need robust AML systems, policies and procedures in place. All money laundering risks must recognised, analysed and suitably mitigated. Now more than ever, regulators will expect answers to their questions.
Comply with 6AMLD with Napier
Napier’s advanced AML technology is designed to work seamlessly alongside your existing systems. This allows you to enhance and improve the effectiveness of your compliance programme with the confidence of continuing to use your existing infrastructure.
Our next generation Intelligence Compliance Platform will transform how you comply with 6AMLD. Book a demo to discover how.