France’s Efforts Against Money Laundering: An Overview

In its endeavor to combat money laundering and terrorist financing, France has introduced various anti-money laundering regulations. These measures aim to prevent the misuse of financial systems and ensure transparency in financial transactions.

Prohibited Transactions

Credit, payment, and electronic money institutions are prohibited from conducting transactions with shell banks, which are banks with no physical presence in the countries where they are licensed and no effective supervision.

Reporting Suspicious Activity

Financial institutions and designated businesses are required to report any suspicious activity that may be linked to money laundering or terrorist financing. This includes operations that originate from an offence punishable by a custodial sentence of more than one year.

France is working towards enhancing information sharing between financial institutions, government authorities, and other stakeholders to combat money laundering and terrorist financing. Three Acts are currently under project at the European level to achieve this goal:

The EU’s “single regulation”
The Sixth Directive on the fight against money laundering
The creation of the European Anti-Money Laundering Authority

Evaluation by Outside Organisations

France’s anti-money laundering regime has been evaluated by several outside organisations, including the Financial Action Task Force (FATF), which last evaluated France in May 2022. The report concluded that France has a robust framework but needs to improve its supervision of professionals and the not-for-profit sector.

Accessing Anti-Money Laundering Laws and Regulations

The anti-money laundering laws, regulations, administrative decrees, and guidance of France are publicly available on the Internet, although some may not be available in English. The FMFC, TRACFIN report, and FATF report can be accessed online, and translations can easily be made.

Modernising the Anti-Money Laundering Regime

France is working towards modernising its anti-money laundering regime by taking advantage of new technology and reducing the compliance burden on financial institutions and other businesses subject to anti-money laundering controls. Improvements are being discussed at the European level, including the EU’s Sixth Anti-Money Laundering Directive.

Additional Proposals

The European Commission has proposed several measures to strengthen the fight against money laundering, including:

Standardising European supervision
Giving more powers to financial intelligence units
Harmonising content and access to registers of beneficial owners
Creating the European Anti-Money Laundering Authority

By implementing these anti-money laundering regulations, France aims to prevent the misuse of its financial system and ensure a safer and more transparent environment for businesses and individuals alike.