Is your risk management process ready for new compliance requirements of the EU's 5th & 6th AML Directives?
06 Jul 2020 10:46 am by Mark Dunn
2020 is a key year for Anti-Money Laundering regulation. The European Union’s Fifth Anti-Money Laundering Directive (5AMLD) came into force in January, and the Sixth Directive (6AMLD) will come into force in December. As a result, companies operating across Europe—and multinationals based in the U.S.—need to ensure their due diligence and risk monitoring processes are aligned to meet the evolving requirements. Our new factsheet identifies the main changes in the legislation, and how Nexis® Solutions can support you to adapt.
5AMLD and 6AMLD are detailed pieces of legislation establishing stricter requirements for tackling money laundering and hidden beneficial ownership and expanding criminal liability and punishments for money laundering offences. All companies in the EU, and those doing business with EU entities, need to ensure their AML processes respond to these changes to mitigate reputational, legal, financial, and strategic risks.
Some of the main changes established by the Directives include:
- Requiring that EU member states make their beneficial ownership registries public
- Ensuring PEP lists are up to date and carrying out risk-appropriate due diligence
- Strengthening punishments for AML violations, including longer maximum imprisonments for crimes.
- Mandating international cooperation in the prosecution of suspected AML crimes.
- Unifying possible money laundering offences to a single list of 22 offences
- Making use of reliable, independent data sources to Identify and verify customers
Our new factsheet explains the main changes in 5AMLD and 6AMLD. It also explains how Nexis® Solutions can help companies to address the requirements in the Directives and, in doing so, improve their due diligence and compliance processes. For example, our products help companies to:
- Identify potential compliance risk by using our tools to run checks on individual or entities across lists originating from more than 80 countries and translated from multiple languages.
- Quickly understand risk potential with data-driven risk scores based on negative news, sanctions, PEPs, watchlists, blacklists and financial information.
- Uncover beneficial ownership of companies with access to critical beneficial ownership data, corporate hierarchies, and executive/director relationships for public and private organisations around the globe.
- Manage large volumes of risk checks against regularly updated global lists of PEPs within our solutions or integrating lists into in-house tools via a constant call API.
- Generate reports to maintain an audit trail of due diligence investigations and demonstrate adherence to best practice recommendations of regulators.