Bank Regulation

ECB To Launch Watchdog Network For AML

The European Central Bank is gearing up to launch a network of watchdogs that share information on money laundering in an effort to increase scrutiny of banks.

According to a report in Reuters, citing European Central Bank Supervisory Board Chair Daniele Nouy, the European Central Bank’s Single Supervisory Mechanism will create an anti-money laundering office that will collect and share the information from other supervisors as well as from authorities.

“The AML Office will set up and chair ‘an AML Network’ among Joint Supervisory Teams in charge of the banks whose business model leads to a high level of money laundering risks,” Nouy told European Union parliamentarians, reported Reuters. According to the report, the European Central Bank said it doesn’t have a legal mandate to go after money laundering, which is usually in the hands of the authorities of each European Union country. Reuters noted that Nouy said the new initiative was “in full respect of the allocation of anti-money laundering responsibilities within the current legal framework.”

The move on the part of the European Central Bank comes as money laundering is in the spotlight given the massive scandal with Danske Bank’s Estonian branch. Earlier this week Danske Bank whistleblower Howard Wilkinson, speaking during a public hearing at the Danish parliament, contended that a major European bank helped to process as much as $150 billion in suspicious payments, and noted that two U.S.-based lenders were involved. Wilkinson, who was head of Danske Bank‘s trading unit in the Baltics from 2007 to 2014, wouldn’t name the banks during the hearing. Reuters, citing sources, reported that Deutsche Bank, JPMorgan, and Bank of America all cleared dollar transactions for the Estonian branch of Danske Bank. The comments came as regulators in Denmark, Estonia, Britain, and the U.S. are investigating $228.5 billion in payments made through the branch from 2007 through 2015.


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