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FIG Bulletin Recent developments 13 September 2019
FIG Bulletin Recent developments 13 September 2019
General 4
FCA Directory of financial services workers: FCA webpage and user guide 4
SMCR: BSB good practice guidance on regulatory references 4
SMCR extension: Form K information 4
SMCR: UK Finance report 4
Regulation of funeral plans: FCA initial thoughts 5
FCA quarterly consultation paper 25: CP19/27 5
Brexit 7
Financial Services (Implementation of Legislation) Bill 2017-19 falls 7
FCA efforts to ensure firms are getting ready for a no-deal Brexit 7
BoE updated Brexit analysis 7
Risk Transformation and Solvency 2 (Amendment) (EU Exit) Regulations 2019 8
Capital Requirements (Amendment) (EU Exit) Regulations 2019 8
Prospectus (Amendment etc.) (EU Exit) Regulations 2019 8
Financial Services (Electronic Money, Payment Services and Miscellaneous Amendments) (EU Exit) Regulations 2019 9
Brexit and third country benchmarks 10
FCA quarterly consultation paper 25: CP19/27 10
No-deal Brexit: European Commission Communication and legislative proposals 10
Hogan Lovells Brexit resources 11
Banking and Finance 12
PRA Dear CEO letter on money laundering and terrorist financing risks in prudential supervision 12
Pre-issuance notification regime: PRA CP20/19 12
Banks stress tests and the countercyclical capital buffer: BoE speech 12
Securitisation Regulation added to EBA single rulebook and Q&A 12
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ECB supervisory priorities for 2020 12
Prudential treatment applicable to legacy own funds instruments: EBA annoucement 13
LEI and Securities Financing Transaction Regulation: ISLA paper 13
Payment Services 14
LINK interchange fee structure: PSR discussion summary and call for views 14
Data in the payments industry: PSR RP19/1 14
Funds and Asset Management 15
UK NPPR and material change notifications: FCA procedure 15
FCA Policy Development Update 15
Stress simulation for investment funds: ESMA economic report 15
Financial Crime 16
Destruction of documents: FCA brings first prosecution 16
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General
FCA Directory of financial services workers: FCA webpage and user guide
The Financial Conduct Authority (FCA) has published a new webpage on its public directory for checking the details of key people working in financial services. It has also published a user guide to help firms submit data to the Directory.
The following deadlines apply to firms submitting information for entry into the Directory:
• banks, building societies, credit unions and insurance companies must submit their data between 9 September 2019 and 9 March 2020; and
• all other firms must submit their data between 9 December 2019 and 9 December 2020.
SMCR: BSB good practice guidance on regulatory references
The Banking Standards Board (BSB) has published good practice guidance on receiving and issuing regulatory references under the senior managers and certification regime (SMCR). It has also published a summary of responses received to its related consultation.
The BSB's Statements of Good Practice are living documents and are kept under review.
SMCR extension: Form K information
The FCA has updated its SMCR webpage for solo-regulated firms in respect of Form K information. Form K is relevant to:
• enhanced firms who must submit Form K to the FCA to notify it which currently approved individuals should be converted to a mapped senior management function; and
• core firms that have a non-executive Chair.
Form K must be submitted by 23.59 on 24 November 2019 and was made available on Connect from 9 September 2019. The FCA has also updated its webpage on converting from the approved persons regime to the SMCR, with information for sole traders.
SMCR: UK Finance report
UK Finance has published a report on the evolution and reform of the SMCR in the banking sector.
The aim of the report is to establish if change has occurred as a result of the SMCR, both in individuals and at firms. UK Finance claims it is the most in-depth study conducted to date of the practical implications of the SMCR, benefiting from the responses over a year of more than 25 banking institutions, almost 60 senior managers and drawing on nearly 2000 data points.
The key finding of the report is that the introduction of the SMCR has been regarded as a positive development, which has led to improvements in behaviours and processes within firms. The report also sets out recommendations on where further improvements could be made to the regime.
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Regulation of funeral plans: FCA initial thoughts
The House of Commons Treasury Committee has published a letter, dated 26 July 2019, from Andrew Bailey, Chief Executive of the FCA, to Gosia McBride, Committee Clerk, regarding the regulation of funeral plans. Mr Bailey's letter responds to a request from Nicky Morgan, former Committee Chair, asking the FCA to provide information on how it will regulate funeral plan providers. In his letter, Mr Bailey responds to specific questions asked of the FCA.
Mr Bailey notes that, at present, entering into a funeral plan contract is a regulated activity. However, the FCA does not authorise any firms for this activity as firms can rely on exclusions in the Regulated Activities Order 2001 for entering into plans that are either insurance or trust-backed and meet certain conditions. HM Treasury is consulting on removing these exclusions to bring this activity within the FCA's remit. The consultation closed on 25 August 2019 and feedback is expected by the end of the year. HM Treasury's proposals envisage an 18-month implementation period after the necessary legislation is made.
While the FCA cannot pre-empt the outcome of HM Treasury's consultation, it is conducting research on what action it may need to take should the perimeter be broadened in respect of funeral plans. The FCA would aim to publish a consultation paper shortly after the relevant legislation is laid before parliament. The FCA should then be in a position to publish final rules with sufficient time before implementation of the regime for firms to familiarise themselves with them and apply for authorisation.
FCA quarterly consultation paper 25: CP19/27
The FCA has published its 25th quarterly consultation paper (CP19/27), proposing miscellaneous amendments to the Handbook. Issues consulted on in CP19/27 relate to:
• minor amendments to Chapter 15 of the Supervision manual (SUP) related to Alternative Investment Fund Managers Directive (AIFMD) Forms (chapter 2);
• amendments to the Collective Investment Schemes sourcebook (COLL) (chapter 3); • minor Handbook amendments to update references to the UK Corporate Governance
Code (chapter 4); • changes to the Disclosure Guidance and Transparency Rules sourcebook (DTR) to
implement the European Single Electronic Format (chapter 5); • implementing the changes made by HM Treasury to domestic legislation to reflect the
amendments brought by the European Commission’s Regulatory Fitness and Performance Programme (REFIT) to the European Market Infrastructure Regulation (EMIR) and make firms aware of the FCA’s new powers set out in the amended domestic legislation (chapter 6);
• further Brexit-related changes to Handbook and binding technical standards (BTS) following the extension of Article 50 (chapter 7);
• seeking views from interested stakeholders about whether the Lending Standards Board's Standards of Lending Practice for business customers meet the FCA's Codes Recognition Criteria (chapter 8);
• modifications to periodic fees rules for Recognised Overseas Investment Exchanges that are also European Economic Area market operators (chapter 9);
• changes to regulatory reporting requirements (chapter 10); • modifying the FCA's "wake-up" pack and annuity information prompt rules (chapter 11);
and
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• changes to the Training and Competence (TC) sourcebook list of appropriate qualifications (chapter 12).
The consultations close on 4 October 2019 for chapters 2, 7, 9, 10 11 and 12, and by 1 November 2019 for chapters 3, 4 5, 6 and 8.
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Brexit
Financial Services (Implementation of Legislation) Bill 2017-19 falls
The Financial Services (Implementation of Legislation) Bill 2017-19 has fallen following the prorogation of the UK Parliament. The Bill aimed to provide the power to HM Treasury, in the event of a no-deal exit, to implement and make changes to "in-flight" legislation. These are pieces of EU financial services legislation that:
• have been adopted by the EU, but do not yet apply so cannot be onshored by the Withdrawal Act; or
• are currently in negotiation and may be adopted within two years after exit day.
The Bill will need to be reintroduced in the next parliamentary session or abandoned entirely.
FCA efforts to ensure firms are getting ready for a no-deal Brexit
The FCA is stepping up its efforts to ensure firms are aware of what they need to do to prepare for the potential of a no-deal Brexit. It urges all firms to consider the implications of a no-deal exit and finalise their preparations.
To help firms prepare, the FCA will run a series of digital adverts signposting to the FCA Brexit webpages, and has set up a dedicated telephone line (0800 048 4255).
In relation to UK firms losing their passport into the EEA, the FCA warns that whether firms need regulatory permissions to continue to do business in an EEA country will depend on the activity they are carrying on, the local law and the approach of the local authorities in that jurisdiction. It advises that firms should make themselves aware of any transitional regimes, with deadlines or registration requirements.
The FCA has made available a list of EEA regimes on its website. However, it highlights that, under the Luxembourg transitional regime for existing contracts, firms must register by 15 September 2019.
Firms should also consider regulatory changes that could apply in the event of no-deal. For example:
• MiFID II transaction reporting will change; • there will be a number of other changes to the FCA Handbook; • the Temporary Permissions Regime will come into force; and • the FCA will become responsible for credit ratings agencies and trade repositories.
BoE updated Brexit analysis
The House of Commons Treasury Committee has published a letter (dated 3 September 2019) received from Mark Carney, Bank of England (BoE) Governor, on the BoE's economic analysis of Brexit. The BoE was responding to a letter (dated 17 July 2019) from the Committee asking whether previous BoE economic analysis, produced in November 2018, remained "fully relevant".
The BoE explains the context of its previously produced EU withdrawal scenarios. In summary, it states that advancements in preparations for a no-deal exit mean that the BoE's assessment of a no-deal exit is now less severe compared with previously. However, the BoE's assessment of
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scenarios where there is a withdrawal agreement followed by a transition to a WTO (World Trade Organisation) trading relationship or by a transition to a new economic partnership, remains the same.
Risk Transformation and Solvency 2 (Amendment) (EU Exit) Regulations 2019
The Risk Transformation and Solvency 2 (Amendment) (EU Exit) Regulations 2019 (SI 2019/1233) have been published, together with an explanatory memorandum. This statutory instrument (SI) ensures that Solvency II and related legislation will continue to operate effectively once the UK has left the EU. The SI amends:
• the Risk Transformation Regulations 2017; • the Markets in Financial Instruments (Amendment) (EU Exit) Regulations 2018; • the Solvency 2 and Insurance (Amendment, etc.) (EU Exit) Regulations 2019; • the Financial Services and Markets Act 2000 (Amendment) (EU Exit) Regulations 2019;
and • retained direct EU legislation: Commission Delegated Regulation (EU) 2015/35.
The SI came into force on 6 September 2019. Regulations 3 and 4 come into force immediately before exit day, and the remaining regulations come into force on exit day.
Capital Requirements (Amendment) (EU Exit) Regulations 2019
The Capital Requirements (Amendment) (EU Exit) Regulations 2019 (SI 2019/1232) have been published, together with an explanatory memorandum. The SI aims to correct deficiencies in the retained EU Law version of the Capital Requirements Regulation (575/2013) (CRR) (UK CRR) to reflect those provisions of the CRR II Regulation ((EU) 2019/876) that will apply before 31 October 2019. The SI amends:
• the Regulated Covered Bonds Regulations 2008; • the Capital Requirements Regulations 2013; • the Capital Requirements (Country-by-Country Reporting) Regulations 2013; • the Capital Requirements (Capital Buffers and Macroprudential Measures) Regulations
2014; and • the Capital Requirements (Amendment) (EU Exit) Regulations 2018.
The SI will come into force on exit day, with the exception of certain provisions specified in regulation 1(2), which came into force on 6 September 2019.
Prospectus (Amendment etc.) (EU Exit) Regulations 2019
The Prospectus (Amendment etc) (EU Exit) Regulations 2019 (SI 2019/1234) have been published, together with an explanatory memorandum. The SI aims to update the EU exit legislation following the repeal and replacement of the EU Prospectus Directive with the EU Prospectus Regulation to ensure the UK prospectus regime continues to function effectively after the UK leaves the EU. This SI amends:
• the EU Prospectus Regulation (2017/1129); • the Official Listing of Securities, Prospectus and Transparency (Amendment etc.) (EU
Exit) Regulations 2019; • Commission Delegated Regulation (EU) 2019/980; • Commission Regulation (EC) 1596/2007;
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• the EEA Agreement; • the Financial Services and Markets Act 2000 (FSMA); • the FSMA (Financial Promotion) Order 2005; • the Equivalence Determinations for Financial Services and Miscellaneous Provisions
(Amendment etc) (EU Exit) Regulations 2019; • the Financial Services and Markets Act 2000 (Amendment) (EU Exit) Regulations 2019; • the Gibraltar (Miscellaneous Amendments) (EU Exit) Regulations 2019; • the FSMA (Prospectus) Regulations 2019; and • the Official Listing instrument.
The SI will largely enter into force on exit day; however most of the amendments to the Official Listing instrument and certain other amendments came into force on 6 September 2019.
Financial Services (Electronic Money, Payment Services and Miscellaneous Amendments) (EU Exit) Regulations 2019
The Financial Services (Electronic Money, Payment Services and Miscellaneous Amendments) (EU Exit) Regulations 2019 (SI 2019/1212) have been published, together with an explanatory memorandum. The SI aims to address failures of retained EU law to operate effectively and other deficiencies arising from the UK's withdrawal from the EU. It includes key provisions relating to the contractual continuity schemes for payment services and electronic-money firms, and the transitional provisions for third country benchmarks. It also makes a number of other amendments to existing exit instruments.
The explanatory memorandum explains that, while the SI does not change the policy approach of earlier EU exit instruments, it does strengthen a number of important provisions. It also corrects minor issues identified in earlier EU exit legislation. The SI includes amendments to:
• the Financial Services and Markets Act (FSMA); • the Banking Act 2009; • the Electronic Money Regulations 2011 (SI 2011/99); • the Payment Services Regulations 2017 (SI 2017/752); • the Electronic Money, Payment Services and Payments Systems (Amendment and
Transitional Provisions) (EU Exit) Regulations 2018 (SI 2018/1201); • the EEA Passport Rights (Amendment, etc., and Transitional Provisions) (EU Exit)
Regulations 2018 (SI 2018/1149); • the Financial Regulators’ Powers (Technical Standards etc.) (Amendment etc.) (EU Exit)
Regulations 2018 (SI 2018/1115); • the Markets in Financial Instruments (Amendment) (EU Exit) Regulations 2018 (SI
2018/1403); • the Gibraltar (Miscellaneous Amendments) (EU Exit) Regulations 2019 (SI 2019/680); • the Alternative Investment Fund Managers (Amendment etc.) (EU Exit) Regulations
2019 (SI 2019/328); • the Equivalence Determinations for Financial Services and Miscellaneous Provisions
(Amendment etc.) (EU Exit) Regulations 2019 (SI 2019/541); • the Benchmarks (Amendment and Transitional Provision) (EU Exit) Regulations 2019
(SI 2019/657); • the Securitisation (Amendment) (EU Exit) Regulations 2019 (SI 2019/660); and • some binding technical standards (BTS).
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The SI and regulations 2 to 7, 9 to 13, 15, 19(1) and (2), and 22(1) and (2) come into force on 6 September 2019. The other provisions of the SI come into force immediately before exit day.
Brexit and third country benchmarks
The Financial Services (Electronic Money, Payment Services and Miscellaneous Amendments) (EU Exit) Regulations 2019 (SI 2019/1212) reported above includes amendments to the Benchmarks (Amendment and Transitional Provision) (EU Exit) Regulations 2019 (SI 2019/657).
In brief, the amendment extends the UK transitional regime for third country benchmarks, which was going to end on 31 December 2019 (reflecting the provisions of the Benchmarks Regulation), to three years.
This will enable UK firms to use third country benchmarks until the end of 2022, without the need for those benchmarks to be on the FCA register. It will also give administrators of third country benchmarks sufficient time to gain endorsement of specific benchmarks or recognition as an administrator.
FCA quarterly consultation paper 25: CP19/27
Reported in our General section above, the FCA has published its 25th quarterly consultation paper (CP19/27), proposing miscellaneous amendments to the Handbook. Among other things, in chapter 7 of CP19/27, the FCA consults on further Brexit-related changes to its Handbook and BTS following extension of Article 50.
The consultation period for these changes ends on 4 October 2019.
No-deal Brexit: European Commission Communication and legislative proposals
On 4 September 2019, the European Commission published a further Communication on finalising preparations for the withdrawal of the UK from the EU on 1 November 2019. The Communication summarises the state of play so far and calls on actors in various sectors to finalise their preparations ahead of a possible no-deal withdrawal.
In relation to financial services, the Commission strongly encourages insurance firms and other financial service operators that have not yet done so to finalise their preparatory measures by 31 October 2019.
Following the adoption of various contingency measures on 19 December 2018, the Commission notes that firms have largely prepared for a no-deal withdrawal, and that they now need to finalise their preparations in the timeframe given by these contingency measures. In particular, the Commission refers to:
• its Decision, expiring on 30 March 2020, which allows the European Securities and Markets Authority (ESMA) to recognise temporarily central counterparties currently established in the UK, allowing them to continue providing services in the EU;
• its Decision, expiring on 30 March 2021, which temporarily allows UK central securities depositories to continue providing notary and central maintenance services to operators in the EU; and
• two Delegated Regulations to allow EU27 operators with outstanding non-cleared derivative contracts to replace UK counterparties with EU counterparties within 12
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months of the UK’s withdrawal from the EU, without losing the prudential treatment that these contracts currently enjoy.
The Commission's assessment is that firms have largely prepared for a withdrawal without an agreement, including by novating their outstanding contracts to replace UK counterparties, and that they now have to finalise their preparations in the timeframe given by the above contingency measures. The Commission does not consider that the adoption of additional contingency measures is necessary. However, it will monitor and re-assess matters following the UK's exit from the EU.
The Commission's Communication is also accompanied by five legislative proposals. The proposals aim to extend the periods of application of the existing EU contingency Regulations on road connectivity, air connectivity, reciprocal fishing access and EU financing. They also aim to allow for financial assistance under the European Globalisation Adjustment Fund and the European Solidarity Fund in cases of severe economic disruptions caused by a no-deal Brexit. These proposals need to be formally adopted by the European Parliament and the Council before they enter into force.
The Commission also published a checklist that aims to help businesses that trade with the UK to make their final preparations to minimise disruptions in a no-deal scenario. The Commission will update the checklist as necessary.
Hogan Lovells Brexit resources
Given the moving Brexit target at the moment we recommend that for an up-to-date take on Brexit impact please try the Hogan Lovells Brexit Hub an open resource online.
Hogan Lovells Brexit Hub
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Banking and Finance
PRA Dear CEO letter on money laundering and terrorist financing risks in prudential supervision
The Prudential Regulation Authority (PRA) has published a Dear CEO letter on money laundering and terrorist financing risks in prudential supervision. The PRA draws the attention of firms to a recent EBA opinion on this subject, indicates its support for the EBA opinion and its expectations in line with it.
Pre-issuance notification regime: PRA CP20/19
The PRA has published a consultation paper (CP20/19), which sets out its proposed amendments to the pre-issuance notification (PIN) regime applicable to PRA-authorised Capital Requirements Regulation (CRR) firms.
The PRA says the proposals would make the PIN regime more risk-sensitive and proportionate, and would allow firms greater flexibility in issuing capital instruments.
The consultation ends on 9 December 2019. The proposed implementation date for the changes is 1 April 2020.
Banks stress tests and the countercyclical capital buffer: BoE speech
The Bank of England (BoE) has published a speech by Donald Kohn, Financial Policy Committee (FPC) member, given at the London School of Economics, on the UK experience of banks' stress tests and the countercyclical capital buffer (CCyB).
Among other things, Mr Kohn discusses:
• the causes and consequences of procyclical risk-based bank capital and the role the FPC envisions for the CCyB, informed by stress tests, in countering this tendency;
• how the FPC has used the CCyB and stress tests in practice; and • some areas for potential further research.
Mr Kohn notes that the FPC along with the Prudential Regulation Committee will be discussing and deciding on an update to the BoE's "Approach to stress testing" document later this year.
Securitisation Regulation added to EBA single rulebook and Q&A
The European Banking Authority (EBA) has added to its interactive single rulebook and Q&A tool the "simple, transparent and standardised" (STS) Securitisation Regulation.
ECB supervisory priorities for 2020
The European Central Bank (ECB) has published the introductory statement made by Andrea Enria, ECB Supervisory Board Chair, at the first ordinary hearing in 2019 of the newly-elected European Parliament's Economic and Monetary Affairs Committee (ECON). In his statement, Mr Enria outlined the ECB's key supervisory priorities for 2020.
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Prudential treatment applicable to legacy own funds instruments: EBA annoucement
The EBA has announced its intention to provide clarity on the appropriate treatment of "legacy instruments" at the end of 2021.
When the CRR entered into force, certain capital instruments that, at that time, did not comply with the new definition of own funds were grandfathered for a transition period with the objective of phasing them out from own funds. These grandfathering provisions expire on 31 December 2021.
The EBA aims to communicate its intentions towards the "legacy" grandfathered instruments by mid-2020 so that institutions can adequately prepare for the end of the grandfathering period.
LEI and Securities Financing Transaction Regulation: ISLA paper
The International Securities Lending Association (ISLA) has published a paper on the legal entity identifier (LEI) and Securities Financing Transaction Regulation (SFTR). The paper considers the introduction of the global LEI for financial markets, and its relevance and application around the industry, in light of the SFTR reporting requirements, which apply to market participants in 2020.
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Payment Services
LINK interchange fee structure: PSR discussion summary and call for views
The Payment Systems Regulator (PSR) has published a paper setting out responses to its June 2019 call for views on the structure of LINK interchange fees (CP19/5) and a summary of a roundtable discussion on this topic. The summary includes discussion on:
• the impact of existing arrangements on the ATM network; and • potential options for delivering appropriate incentives and outcomes.
The PSR mentions that, in addition to its work on the structure of the interchange fees, it has published a separate call for views on cash access, use and acceptance (CP19/6). A further stakeholder roundtable discussion will take place in October to discuss responses to that.
Data in the payments industry: PSR RP19/1
Following its earlier discussion paper on the topic, DP18/1, the PSR has published the responses it received and its own response paper, RP19/1, on data in the payments industry. The PSR feeds back on the three focus areas it consulted on:
• access to scheme-wide datasets (data on transactions across a whole payment system); • end-user willingness to share data; and • realising the benefits of enhanced data.
The PSR has also outlined its intention to work with Pay.UK to examine the possible ways data can be used in the UK's new payments architecture, including the potential for using synthetic (or "dummy") data to develop new services.
The PSR states that stakeholders generally recognised that payments data could offer benefits to consumers and the industry, including the potential for new payment services and anti-crime measures.
The PSR highlights several areas where the industry needs to manage the emerging issues in payments data.
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Funds and Asset Management
UK NPPR and material change notifications: FCA procedure
The FCA has updated its webpage on the national private placement regime (NPPR) announcing that, from 9 September 2019, changes are introduced to the submission of NPPR marketing or material change notifications by alternative investment fund managers (AIFMs) marketing alternative investment funds (AIFs) under regulations 58, 59 and 57 of the Alternative Investment Fund Managers Regulations 2013. The changes are detailed on the FCA webpage.
FCA Policy Development Update
The FCA has updated its policy development update webpage for September 2019, setting out information on recent and future FCA publications. Among other things, the FCA confirms it intends to publish a policy statement to CP18/27 on illiquid assets and open-ended funds in the third quarter of 2019.
Stress simulation for investment funds: ESMA economic report
The European Securities and Markets Authority (ESMA) has published an economic report on stress simulation for investment funds.
In the report, ESMA provides an overview of the framework it uses for stress simulations. In particular, it looks at:
• the calibration of redemption shocks for investment funds; • methods to assess the resilience of funds to shocks; • ways to measure the impact of fund managers' liquidation strategies on financial
markets; and • possible second-round effects.
ESMA also provides a case study on how the framework can be applied.
The ESMA stress simulation (STRESI) framework is a simulation-based approach combining micro and macro prudential objectives. On the micro side, its output is an assessment of the resilience of relevant parts of the investment fund sector with a view to informing regulators. On the macroprudential side, the STRESI framework will include an estimation of the impact of an adverse scenario on the fund sector and its potential spillovers to the financial system, thus capturing financial stability risks beyond the individual fund level.
ESMA intends to use the STRESI framework as part of its regular risk monitoring to identify risk and assess possible adverse scenarios that might affect the EU fund industry.
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Financial Crime
FCA speech on fight against fraud
The FCA has published a speech given by Charles Randell, Chair of the FCA, on the fight against fraud. Highlights include:
• the FCA is committed to the success of the Economic Crime Plan alongside public and private sector partners to beat investment fraud;
• fraud prevention needs to be embedded in the development of new savings and investment policies;
• it is vital to reduce confusion around what is and is not regulated and protected by the Financial Services Compensation Scheme to promote responsible saving; and
• a call for non-financial firms that enable fraud to step up their contribution to the fight against it.
Destruction of documents: FCA brings first prosecution
The FCA has brought its first prosecution against an individual for the destruction of documents that the person knew or suspected were or would be relevant to an investigation, in breach of section 177(3)(a) of FSMA.
The FCA was investigating the individual for suspected insider dealing offences. It alleges that the individual, who has pleaded not guilty, deleted the WhatsApp application on his mobile phone after being required to provide it as part of the FCA's investigation.
The case will be heard on 4 October 2019.
AML and CTF powers: EBA speech
The EBA has published a speech given by Jose Manuel Campa, Chair of the EBA, on the EBA's anti-money laundering (AML) and counter-terrorist financing (CTF) powers.
The Chair discusses recent AML and CTF experiences and initiatives. He notes that the Money Laundering Directives' minimum harmonisation and directive-based approach does not eliminate national differences.
"Divergence of national practices exposes the Union’s internal market to significant ML/TF risks… Standardised risk-based methodologies, CDD [customer due diligence] requirements, and better cooperation and information sharing between competent authorities are needed, along with a further push at European and national level to ensure resources, knowledge and the impetus to act are strong across the single market."
If current rules and initiatives in the pipeline do not achieve adequate results, the Chair suggests that further centralisation by means of an AML/CFT Regulation may be necessary to achieve consistent outcomes and full accountability for relevant authorities.
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AML - reinforcing the supervisory and regulatory framework: European Parliament briefing
The European Parliament has published a briefing on the EU AML supervisory and regulatory framework. The briefing outlines:
• the EU supervisory architecture and the respective roles of European and national authorities in applying AML legislation; and
• proposals to further improve the AML supervisory and regulatory frameworks.
Some previous AML cases are presented in Annex.
This briefing updates an April 2018 briefing by the Economic Governance Support Unit.
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