We are living in extraordinary times. We have taken unprecedented action to support the European economy as it reels from the impact of this pandemic. And more will follow.
Today, we turn our attention to the financial system. At a time like this, protecting its stability and integrity is essential.
Our six-point Action Plan tackles money laundering from all angles to build a comprehensive system that will stop criminals in their tracks..
Fighting money laundering is as relevant now as before the pandemic. In fact, coronavirus-related crime and the laundering of its proceeds is on the rise, according to Europol and national law enforcement authorities.
Today's plan will protect our financial system and make sure that the internal market works properly and smoothly.
Firstly, while there are robust EU rules in place, they must be applied consistently and efficiently. We will make sure that everyone in both private and public sectors applies the rules rigorously. We have launched many infringement procedures to ensure the full transposition and application of the two core directives - AMLD4 and AMLD5. But we clearly need to go further.
In future, the EU supervisor will have to conduct on-site investigations to check the effectiveness of the AML system.
Next, we need to strengthen our rules and tackle remaining weaknesses. To give you one example: we now see more cases of online money laundering. Financial intelligence units should have the powers to freeze any suspicious transactions of this kind.
EU legislation needs to become more detailed and less subject to diverging interpretation. We will therefore propose a Regulation to strengthen the current framework so that rules become directly applicable.
We have strict rules but as we saw from the string of recent scandals, these are not consistently applied across the EU. The EU supervisory system is only as strong as its weakest link. So we will also introduce a EU-level supervision.
We are presenting different options for consultation. We may propose a new EU agency, or add to the responsibilities of the European Banking Authority, depending on the feedback we get. However, if the EBA is to become the EU supervisor, both its track record and governance will have to improve.
Then, we will set up a mechanism to improve the coordination between financial intelligence units, so they can better track and report suspicious flows of money across borders.
We will also use new tools and structures to improve the investigation and prosecution of money laundering. This is where the private and public sectors really have to work hand-in-hand: our anti-money laundering machinery needs to work seamlessly.
We are tightening up the system. But it is important that we have a risk-based approach so that we avoid companies facing unintended consequences due to divergences in the way preventive measures are applied. Our rules, and the ways banks are implementing them, should not prevent honest operators from getting access to finance.
Lastly, point six of the plan: we will give the EU a stronger global role in fighting money laundering and terrorism financing. We will work with Member States to raise the level of international standards to fight money laundering globally.
We will first create an EU list of countries that the Financial Action Task Force has identified as having weak anti-money laundering systems. But we won't stop there. We will independently assess other countries whose deficiencies represent a high risk to us, for possible inclusion on that list.
This exercise aims to protect our financial system. We will be in direct and in-depth contact with these countries, working with them to find ways to address their deficiencies. The methodology used as part of today's package will form the basis of future updates to the list.
We are today also issuing a revised list of these high-risk countries, taking into account the assessment by FATF and additional criteria under the AML directive.
Given the progress made by 6 countries, we have removed them from our list. They are: Bosnia-Herzegovina, Guyana, Lao, Ethiopia, Sri Lanka and Tunisia.
At the same time, we are adding 12 countries to our list that the Financial Action Task Force found to have weak systems - namely: the Bahamas, Barbados, Botswana, Cambodia, Ghana, Jamaica, Mauritius, Mongolia, Myanmar, Nicaragua, Panama and Zimbabwe. We welcome their commitment to reform quickly.
If a country appears on the list, banks and other professionals are obliged to increase their scrutiny of all business transactions involving operators located in that territory. There are also consequences in terms of the flow of EU funding. These can no longer be channelled through a listed country in the future, except if projects are physically implemented in the listed country.
We are mindful of the disruptions caused by the pandemic. To allow stakeholders and authorities sufficient time to prepare, as an exceptional measure this listing will not come into force until 1st October this year.
We are confident that this package will protect the integrity of our financial system at this difficult time.
I invite everyone to take part in our consultation. Your views will feed into the legislative proposals we will present in the first quarter of next year.
No more weak links. No more loopholes for criminals to exploit. There is no place for dirty money in Europe's financial system. We trust Member States and European Parliament will show the same level of ambition.