European Union’s new anti-money laundering (AML) watchdog will be based in Frankfurt after the German city beat bids from eight other cities.
Known as the Anti-Money Laundering Authority (AMLA), the new agency will be tasked with cracking down on money laundering and terrorism financing across Europe. It will commence operations in 2025 with a workforce of over 400 AML experts.
AMLA was first proposed in 2021 by the European Commission as the first regional supervisory institution tasked with cracking down on dirty money.
European cities submitted their applications the following year, and intense lobbying kicked off. Madrid, Vienna, Rome, Paris, Brussels, and Dublin were among the contenders.
Last week, AMLA became the first regional authority whose headquarters were decided through member votes. European legislators took to the ballot on February 22, and Frankfurt—also home to the European Central Bank (ECB)—emerged victorious despite
complaints from some contestants.
German Finance Minister Christian Lindner, who led the lobbying for Frankfurt, welcomed the victory, saying it will complement the country’s existing AML initiatives.
📍 #Frankfurt will be the new seat of the European anti-money laundering authority #AMLA. This was confirmed today. We are delighted that our bid was successful. Fighting financial crime is a top priority for 🇩🇪 & the 🇪🇺 – and will be implemented by #AMLAinFrankfurt.
— Bundesministerium der Finanzen (@BMF_Bund) February 22, 2024
Despite setting AML rules at a regional level, the EU depends on national authorities to implement them and act against offenders, and this hasn’t always worked out. While some, like Iceland and Finland, rank highly for AML adherence, others, like Hungary and Cyprus, haven’t fared as well.
Digital assets will be among the areas that AMLA will focus on as it strives to rid Europe of dirty money, European Commissioner Mairead McGuinness told the press on Thursday.
“We’re mitigating risks linked to large sums of money with an EU-wide limit of 10,000 euros for cash payments. At the same time, we’re addressing risks posed by crypto and the anonymity it enables,” she stated.
One of the stipulations that the AMLA will enforce is a requirement for enhanced due diligence for virtual asset service providers (VASPs) when handling transactions worth €1,000 ($1,090) or more. The agency will also hold VASPs to many of the same regulations that financial entities must adhere to, including KYC and data storage.
Watch: Probing criminal acts
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