Financial Crime World

EU Requires Immediate Action on Financial Sanctions

Strengthening Efforts Against Money Laundering and Terrorist Financing

Brussels, [Date] - The European Union has introduced new regulations to tighten financial sanctions, requiring individuals and legal entities to take immediate action upon identifying potential violations.

Identification of Violations and Notification

According to the new rules, if a natural or legal person identifies:

  • A subject of financial sanctions
  • A transaction or act violating financial sanctions
  • Additional information that does not enable identification, they must:
    • Apply financial sanctions immediately
    • Notify the Financial Intelligence Unit (FIU) without delay

Mechanisms for Identification and Notification

Individuals and legal entities with specific obligations, such as:

  • Credit institutions
  • Financial institutions
  • Virtual currency service providers must establish mechanisms to identify situations where funds or assets are subject to financial sanctions. These persons must also notify the FIU of any violations or suspicions of circumvention.

Reporting Suspicious Transactions

The EU has announced that it will require reports from individuals and legal entities on suspicious transactions, including those related to the sale of strategic goods. Reports must be submitted:

  • Without delay
  • Not later than within two working days

Role of Financial Intelligence Unit (FIU)

The FIU has been designated as the competent body responsible for processing these reports and implementing financial sanctions. The unit is also required to: + Publish information on the implementation, modification, or termination of financial sanctions + Provide a consolidated overview of their implementation in Estonia

Greater Due Diligence Measures

Persons having specific obligations are subject to greater due diligence measures in the application of financial sanctions due to the nature of their economic and professional activities. These individuals and legal entities must: + Assess risky situations + Store and communicate information about such situations

Key Takeaways

  • Individuals and legal entities must take immediate action upon identifying potential violations of financial sanctions.
  • Reports on suspicious transactions must be submitted without delay but not later than within two working days.
  • The FIU is responsible for processing reports and implementing financial sanctions.
  • Persons having specific obligations are subject to greater due diligence measures in the application of financial sanctions.

Source

European Union, Financial Intelligence Unit