Financial Crime World

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France Tightens Anti-Money Laundering Policies and Procedures in Response to Growing Financial Crime Threat

France, one of the wealthiest countries in Europe and the world, has a robust economy that attracts diverse business interests, including international banks and fintechs. However, this prominence also makes France a target for criminals seeking to launder money, finance terrorist activities, and commit financial crimes.

In response to this criminal threat, the French government has implemented a range of strict anti-money laundering (AML) and counter-terrorist financing (CFT) regulations on its financial institutions. To avoid compliance penalties and contribute to the fight against financial crime, firms operating in France must understand how to meet these compliance obligations efficiently.

France’s Financial Regulators

France has established several financial supervisory authorities, including:

  • Autorité des Marchés Financiers (AMF): The AMF is responsible for regulating France’s financial marketplace and ensuring that firms within French jurisdiction operate in compliance with financial regulations.
  • Autorité de Contrôle Prudentiel et de Résolution (ACPR): The ACPR regulates France’s banking and insurance businesses under the direct authority of the Banque de France, focusing on protecting France’s financial stability by monitoring compliance with AML/CFT regulations.
  • Traitement du renseignement et action contre les circuits financiers clandestins (TRACFIN): TRACFIN operates under the authority of the French Ministry of Finance and is responsible for analyzing and investigating suspicious activity reports submitted by French financial institutions.

FATF Guidelines

As a member of the Financial Action Task Force (FATF), the French government transposes FATF guidance into domestic legislation, which is enforced by financial regulators. The guidelines emphasize the importance of:

  • Customer Due Diligence: Conducting suitable customer due diligence to identify customers and build accurate risk profiles.
  • Beneficial Ownership Checks: Conducting beneficial ownership checks to ensure that customers are not using corporate structures or shell companies to disguise money laundering.
  • Transaction Screening: Screening customer transactions against relevant lists and registers, including PEP lists, beneficial ownership registers, and international sanctions lists.

Complying with French AML Regulations

Effective AML/CFT compliance in France involves:

  • Conducting risk assessments of individual customers
  • Implementing automated software systems capable of managing data collection requirements
  • Incorporating next-generation machine learning technology to match customer names across global data sources

This includes:

  • Customer Identification: Conducting suitable customer due diligence to identify customers and build accurate risk profiles.
  • Beneficial Ownership: Conducting beneficial ownership checks to ensure that customers are not using corporate structures or shell companies to disguise money laundering.
  • Transaction Screening: Screening customer transactions against relevant lists and registers, including PEP lists, beneficial ownership registers, and international sanctions lists.

Recent AML/CFT Developments in France

The AMF publishes updates on French AML/CFT regulation on its news page. Key recent developments include:

  • MiCA: The provisional agreement on the EU’s new crypto regulatory framework, known as Markets in Crypto Assets (MiCA), will regulate crypto-assets and stablecoins across the bloc.
  • ESG Data: The AMF reiterated its call for a Europe-wide regulatory framework for environmental social and governance (ESG) data, highlighting the increasing significance of ESG data in financial risk management.
  • Ukraine Sanctions: The AMF publicized guidance for French firms regarding the enforcement of sanctions against Russia and Russian individuals.

Next Generation Compliance

Ripjar’s Labyrinth Screening platform enables firms to enhance their AML/CFT compliance performance by incorporating next-generation machine learning technology to match customer names across global data sources. Contact us to discuss how Ripjar can support your AML compliance in France.