Spain Introduces Toughest AML Laws in Europe
Madrid, July 2014 - Spain has implemented one of the toughest anti-money laundering (AML) laws in Europe, bringing its regulations in line with recent technological developments and international standards.
The new law updates a 1995 law and introduces stricter measures to combat money laundering. The Spanish government approved the regulation in April 2014, despite having only one year to enact the legislation since it was granted in 2011.
Key Features of the New Law
- Credit institutions must report to SEPBLAC (the Spanish supervisory body for the prevention of money laundering and terrorist financing) the opening or cancellation of current accounts, savings accounts, securities accounts, and term deposits.
- Simplified due diligence measures can be applied to customers or products that show a low risk of money laundering.
- The Financial Ownership File will hold information on account holders’ identity, proxies, and date of opening or cancellation.
- Credit institutions must carry out internal audits of AML policies in place periodically.
Criticisms and Concerns
However, the regulation has been criticized for its hostility towards commercial interests. The exclusion of simplified due diligence measures when e-money is issued against cash has been particularly criticized.
Impact on Financial Institutions
The new law introduces the concept of “politically exposed persons” and sanctions for non-compliance with AML regulations. Credit institutions will have to cope with additional AML burdens, as highlighted by Juan Palomino, a lawyer at Pérez-LLorca.
Palomino also emphasized the importance of internal audits of AML policies in place, which will be carried out periodically and analyze the adequacy and efficiency of internal control policies.
Conclusion
The Spanish government’s move is seen as a significant step towards combating money laundering and terrorist financing. The country has a reputation as a hot spot for money laundering, making it essential to have robust regulations in place.
Contact Information
Juan Palomino Lawyer at Pérez-LLorca jpalomino@perezllorca.com
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