EBA issues opinion on money laundering and terrorist financing risks across the EU

The European Banking Authority (EBA) has published its fifth opinion on money laundering and terrorist financing (ML/TF) risks. In the report, the EBA highlights the growing vulnerabilities in the EU financial sector arising from the growth of technologies, new financial products such as crypto-assets, and the increasing interconnection of financial products and services across sectors. The EBA states that while tools such as RegTech and AI offer potential for enhanced compliance, their improper implementation (often due to lack of expertise and oversight) has led to serious compliance failures. Competent authorities have reported high or rising ML/TF risks in Fintech firms and crypto-asset service providers linked to weak AML/CFT controls and governance. Additionally, the use of AI by criminals to automate laundering and forge documents is outpacing institutional defences. The EBA notes that supervisory engagement has improved the capability of some sectors to fight financial crime. The EBA emphasises the importance for consistent application of the new EU AML/CFT legal framework.

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