A guide to AML Regulations and KYC Requirements in Europe  

17 Nov, 2020 09:49
source: Know Your Customer

Singularity Financial Hong Kong November 17, 2020 – sourced from Know Your Customer

The 2010-2020 decade was characterised by a growing tide of financial regulations in Europe. This was the result of an improved understanding – by regulators and the general public alike – of the penetration of illicit funds within European societies, following a series of high-profile scandals at global financial institutions.

This comprehensive yet highly accessible white paper by Know Your Customer analyses the key financial regulations that came into force in the European Union since 2014, focusing in particular on the impact of such regulations on customer onboarding, know your customer (KYC) and anti-money laundering (AML) requirements for financial institutions either based or looking to expand into Europe.

The regulations analysed in this white paper include:

1. The Fourth, Fifth & Sixth Anti-Money Laundering Directive (AMLD4, 5 & 6), aimed at counteracting money laundering by introducing more thorough checks and better cooperation between countries, as well as harsher criminal liabilities;

2. The Payments Services Directive (PSD2), introduced to stimulate customer-centric innovation in banking, with a focus on preventing payment fraud and misuse of electronic financial tools;

3. The updated Markets in Financial Instruments Directive (MiFID II), primarily driven by the need for more transparency in financial investment operations;

4. The General Data Protection Regulation (GDPR), the EU’s response to the general public’s request to regain control over personal data.

Being familiar with current requirements is essential to fully appreciate the impact of the regulatory changes of tomorrow. In fact, it is likely that the existing requirements will continue to be adjusted as European legislators’ knowledge of criminal practices deepens and as collaborations with regulators in other parts of the world become more frequent. To add a further level of complexity, the unprecedented situation determined by the coronavirus pandemic is also accelerating the pace of digital transformation in KYC compliance, which is likely to re-focus European regulators’ attention on the challenges and opportunities of remote client onboarding.

To find out more, download Know Your Customer’s white paper here.