The European Union’s new regulation aimed at combatting money laundering is expected to go into full effect in two years. As the region moves toward unified supervision and true accountability, Gabriella Bussein of Trapets argues that financial institutions can’t assume their audit-passing compliance processes are adequately mitigating their actual risks.
Recent money-laundering busts at high-profile financial institutions show that crime continues to flow — sometimes undetected — through institutions that seemingly tick every regulatory box. Leaked correspondence between Swiss regulator FINMA and Reyl Bank reveals careless due diligence despite technically being compliant, as well as a business model that prized wealthy, politically exposed clients, even when red flags were waving. Reyl insists it has since strengthened its AML framework, but the story is bigger than one bank. Across Europe and the UK, institutions are mistaking audit-passing compliance for actual risk mitigation.
Meanwhile, regulators are making it clear they’re not fooled. In June, the European Anti-Money Laundering Authority (AMLA) executive board officially took its seats in Frankfurt, part of a new AML regulation that is expected to apply starting in 2027. Implementation of EU AML Regulation (AMLR) and sixth Anti-Money…
