A Guide to Anti-Money Laundering for Crypto Firms
Overview of the
What is European Banking Authority (EBA)?
The European Banking Authority supervises the banking industry across the European Union with the goal of maintaining financial stability…
The European Banking Authority (EBA) was established on 1 January 2011, taking over the functions and responsibilities of the Committee of European Banking Supervisors. Part of the wider European Supervisory Authority (ESA), the EBA is an independent regulatory agency with authority over national regulators within the EU and works to ensure “effective and consistent prudential regulation and supervision” of the banking sector. From a broader perspective, the EBA’s objective is to harmonise banking rules and regulations across the bloc.The EBA was set up by the European Parliament and the Council of the European Union to carry out a specialised legal role and combat financial crimes such as money laundering and the financing of terrorism. Along with the European Central Bank (ECB) and the Single Resolution Board, the EBA is the primary regulator of the European banking industry. Currently chaired by José Manuel Campa and situated in London, the EBA plans to relocate to Paris as a consequence of Brexit – if the UK leaves the EU.
The EBA’s main task is to contribute to the creation of the European Single Rulebook for banking, which is a set of “harmonised prudential rules” for all financial institutions in the EU. The Single Rulebook is designed to create a level regulatory playing field across the banking sector, providing protection to companies and individuals operating within it, and making it easier to comply with EBA rules.
As part of this goal, the EBA works to promote the convergence of regulatory practices by member state authorities, ensuring they apply European financial crime legislation, including anti-money laundering (AML) and counter financing of terrorism (CFT) measures, equally. The EBA’s stated mandate allows it to:
- Investigate incorrect or insufficient application of EU law by national authorities.
- Take decisions directed at individual competent authorities or financial institutions in emergency situations.
- Mediate between competent authorities to resolve cross border disagreements.
- Act as an independent advisor to the European Parliament, Council, or Commission.
- Take a leading role in promoting transparency, simplicity, and fairness in the consumer financial product market or the internal services market.
As part of its mandate to create legislative harmony for EU financial institutions, the EBA seeks to ensure that AML and CFT legislation is being applied both consistently and effectively in member states. To this end, the EBA works with credit and financial institutions, competent national authorities, and pan-EU agencies like the European Securities and Markets Authority (ESMA) and the European Insurance and Occupational Pensions Authority (EIOPA), to:
- Facilitate cooperation between national authorities responsible for AML/CFT compliance.
- Promote a common understanding of the risk-based approach to AML/CFT, and how to apply it.
- Deliver its mandate to EU member states under Directive (EU) 2015/849 and Regulation (EU) 2015/847.
- Engage in dialogue with stakeholders and entities responsible for setting international standards and ensuring financial institutions comply with EBA regulations.
To help member states with their AML and CFT efforts, and reinforce legislative harmonisation, the EBA regularly issues a range of regulatory documents to competent authorities. Those documents include Guidelines, Opinions, Recommendations, and a range of ad-hoc and regular reports. The EBA also produces Binding Technical Standards (BTS) which are legal acts endorsed and adopted by the European Commission, and directly legally-binding to each EU member state.
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