EU to Revisit Stalled Money Laundering Blacklist: FT
20 Aug 2019

The European Commission will revisit plans to publish a list of non-EU jurisdictions deemed to be particularly vulnerable to money laundering, an official from the economic bloc told the Financial Times.

The incoming commission is expected by October to unveil an overhauled methodology on how to draft the blacklist of nations that officials say have fallen short on meeting international anti-money laundering (AML) and counterterrorism financing standards, EU Justice Commissioner Vera Jourova told the newspaper in a report published Sunday.

A previous attempt to adopt a list unraveled in February after 27 of the EU’s 28 member-states blocked the publication of an initial draft on the grounds that it had been written without a “transparent and credible process,” according to the FT.

“The member states were critical with the methodology for two reasons: insufficient involvement from their side in the process and insufficient communication with the territories likely to be listed,” Jourova told the newspaper. “We have admitted this point and said we need to communicate earlier with the states that might appear on the list. That is why we are now reviewing the methodology.”

The initial draft also drew criticism for including jurisdictions not currently singled out by the Financial Action Task Force (FATF), including Saudi Arabia, Guam, the US Virgin Islands, Puerto Rico and American Samoa, the FT said.

The Paris-based intergovernmental organization, which sets international standards on combatting money laundering and terrorist financing, cites only two nations–Iran and North Korea–on its so-called “blacklist” and another 12 on a grey-list of “jurisdictions with strategic deficiencies.” The proposed blacklist ultimately dropped by the European Union earlier this year would have included 23 jurisdictions.

Speaking to the FT, Jourava said that the she believed the European Commission was right to include Saudi Arabia in its initial draft but expected the bloc’s second version to name different countries and allow for a grey-list of jurisdictions that agree to adhere to the EU’s AML standards.

The planned blacklist, if adopted, would not involve the imposition of economic sanctions or other penalties against the governments cited on it, though EU banks would be expected to conduct enhanced due diligence checks on entities and transactions linked to the designees, according to the report.

Read more:

EU states block blacklisting Saudi, Panama over dirty money

Q and A: EU money laundering blacklist explained

EU method of drafting tax blacklists to be investigated

Count this content towards your CPD minutes, by signing up to our CPD Wallet


You must be logged in to post a comment.

This site uses Akismet to reduce spam. Learn how your comment data is processed.