European Commission Reviews Anti-Money Laundering Directive

Insurance Europe set out its preliminary views on the European Commission’s review of the Anti-Money Laundering Directive at a public hearing organised by the Commission recently.

It welcomed the prominent role of the risk-based approach in the Commission’s proposed 4th Anti-Money Laundering Directive. This approach ensures that the measures that are applied appropriately reflect the level of risk.

Speaking at the hearing, Michaela Koller, director general of Insurance Europe, said: “The risk-based approach will enable insurers to allocate their anti-money laundering resources effectively. This is especially important for insurers, as few insurance products are at risk of being used for money laundering.”

Insurance Europe also welcomes the fact that the Commission has followed the approach taken by the intergovernmental Financial Action Task Force (FATF) in applying different requirements to the life insurance industry, thus acknowledging the insurance sector’s distinct risk profile and recognising that some terms have a different meaning in life insurance than, for example, in banking.

Insurance Europe nevertheless believes that further efforts are needed to allow effective compliance with the Directive. For example, there is a risk of inconsistency between the proposed Directive and the Data Protection Regulation, which is currently still under discussion.

“Insurers should not be forced to choose between complying with the data protection rules or their anti-money laundering obligations,” said Koller. Insurance Europe therefore suggests — should there be contradictions between the data protection regulation and the anti-money laundering proposal — that a list is included in the revised Anti-Money Laundering Directive indicating the actions permitted in relation to anti-money laundering duties.

Furthermore, Insurance Europe stresses the need for consistency in the application of the proposed anti-money laundering framework across the EU. For that reason, the European supervisory authorities should issue guidelines ahead of the transposition of the Directive into national law.

“Source: Insurance Europe News”