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Tougher EU money laundering rules target crypto and oligarchs''favourite toys'

Published 01/18/2024, 02:52 AM
Updated 01/18/2024, 07:17 AM
© Reuters. Bitcoin (virtual currency) coins are seen in an illustration picture taken at La Maison du Bitcoin in Paris July 11, 2014. REUTERS/Benoit Tessier/File Photo

By Huw Jones

LONDON (Reuters) -The European Union on Thursday agreed tougher anti-money laundering rules for cryptoassets and dealers in luxury cars and yachts, warning that oligarchs and criminals could no longer hide in the 27-country bloc.

Representatives of EU states and the European Parliament reached a deal on the new framework in negotiations that concluded in the early hours.

"It is a good day for EU citizens and businesses, but bad day for oligarchs and terrorists," said Eero Heinaluoma, one of lawmakers who took part.

The EU has long had anti-money laundering rules, but they were applied differently in each member state, making it easier for cross-border crime to flourish.

Danske Bank's admission in 2018 that suspicious payments totalling 200 billion euros ($218 billion) from Russia and elsewhere flowed through a branch in Estonia highlighted the need to improve cross-border cooperation.

Thursday's deal introduces a single EU rulebook for tackling money laundering across the bloc, completing a package that included a new EU anti-money laundering authority (AMLA) agreed last month.

The latest deal gives AMLA, whose location has yet to be decided, powers to intervene if a member state is too slow in tackling money laundering.

It also broadens the scope of anti-money laundering rules to include cryptoassets, luxury goods traders, football clubs and agents, and "golden" visas granted by some EU states in return for investment in property.

The aim is to check where funds for purchases come from and whether the purchaser is subject to EU sanctions.

CRYPTO CHECKS

Cryptoasset service providers must make checks on customers who carry out transactions worth 1,000 euros or more and report suspicious activity. Cross-border cryptoasset firms must make additional checks.

Traders of luxury goods, precious metals, jewellers and goldsmiths will also have to make checks on customers. Member states can add professional football clubs and agents from 2029.

There will also be an EU-wide maximum limit of 10,000 euros for cash payments, making it harder for criminals to launder money, the statement said.

Firms under the scope of the new rules will have to identify and verify people who carry out occasional transactions in cash between 3,000 and 10,000 euros.

"One of our key objectives was to ensure that white collar criminals will no longer be able to launder their money through acquirement of expensive cars, yachts and private planes," said Paul Tang, a lawmaker who took part in the negotiations.

One of the lawmakers told reporters such purchases were "the favourite toys of oligarchs".

The ultimate or beneficial owner of all foreign entities that own real estate in the EU must be registered, applied retroactively to January 2014.

© Reuters. Bitcoin (virtual currency) coins are seen in an illustration picture taken at La Maison du Bitcoin in Paris July 11, 2014. REUTERS/Benoit Tessier/File Photo

The new rules need a formal nod from EU states and full parliament before they become law.

($1 = 0.9181 euros)

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