The EBA consults on its proposals for a central AML/CFT database

The European Banking Authority (EBA) launched today a public consultation on draft Regulatory Technical Standards (RTS) on a central database on anti-money laundering and countering the financing of terrorism (AML/CFT) in the EU. This database will be a key tool for the EBA’s recently enhanced mandate to lead, coordinate and monitor AML/CFT efforts in the European Union. The consultation runs until 17 June 2021. 

The revised EBA Regulation that came into effect in January 2020 requires the EBA to establish and keep up to date a central database with information on AML/CFT weaknesses that competent authorities (CAs) across the EU have identified in respect of individual financial institutions. The database will also contain information on the measures competent authorities have taken to rectify those material AML/CFT weaknesses. Information from this database will be used by individual competent authorities and the EBA to make the fight against ML/TF in the EU more targeted and effective in the future.

The draft RTS proposed in this Consultation Paper specify the definition and the materiality of weaknesses identified by competent authorities, the type of information collected, and how such information will be communicated to the EBA. It also sets out how the EBA will analyse and disseminate the information contained in the AML/CFT central database.

Moreover, the draft RTS set out the rules to ensure the effectiveness of the database, the confidentiality of the data contained in the database, as well as how the database will interact with other notifications that competent authorities are required to provide to the EBA and the provisions to ensure the protection of personal data.

The AML/CFT central database will be a key tool in coordinating efforts to prevent and counter ML/TF in the Union. It will serve as an early warning tool to enable the competent authorities to act before the ML/TF risks crystalise and help them plan their on-site inspections and perform off-site monitoring.