Financial Crime World

France Cracks Down on Money Laundering and Terrorist Financing with New Laws and Regulations

In the continuing battle against money laundering and terrorist financing (AML-CFT), France’s Autorité des Marchés Financiers (AMF) is leading the charge. With the implementation of the new Fifth Money-Laundering Directive, France has strengthened previous measures and introduced new regulations to enhance transparency and combat these illicit activities more effectively.

Background on Previous Legislation

  • Obligations from the Fourth Directive: Established in late 2016, the Fourth Directive mandated several key measures for French financial institutions:
    • Risk assessment
    • Client and beneficial owner identification and verification
    • Due diligence upon entry and throughout business relations
    • Obligation to file suspicious transaction reports (STRs) to TRACFIN
    • Internal audits and reporting to the AMF
    • Implementation of asset freezing measures

The Fifth AML-CFT Directive: A New Era of Transparency

  • Mandate and Objectives: Proposed in the wake of the 2015 Paris terror attacks and following the “Panama Papers” scandal, the Fifth Directive aims to streamline regulatory efforts and increase transparency surrounding financial transactions. Its main objectives include:
    • Enhancing transparency of legal entities and structures by extending access to beneficial owner registers
    • Harmonizing enhanced due diligence measures for high-risk third countries
    • Specifying measures for remote business relationships
    • Extending AML-CFT regulations to certain virtual asset service providers

Reference Legislation

International

  • FATF Recommendations
  • Risk-based Approach Guidance for the Securities Sector
  • Risk-based Approach Guidance for Virtual Assets and Virtual Asset Service Providers

European

  • Directive (EU) 2015/849
  • Directive (EU) 2018/843
  • Commission Delegated Regulation (EU) 2016/1675

Evolving Regulatory Landscape

With the new regulations and continuous updates, it’s important for financial institutions to stay informed and adapt to the changing regulatory environment. For more information on risk assessments, consult the relevant resources from the European Commission, European Supervisory Authorities, and France’s Autorité des Marchés Financiers.

Risk Assessments

  • European Commission’s risk assessments: View the latest risk assessments from the European Commission here
  • European Supervisory Authorities’ sector risk assessments: Find sector risk assessments and resources from European Supervisory Authorities here
  • France’s Autorité des Marchés Financiers’ risk assessments and guidelines: Browse the risk assessments and guidelines from AMF here:
    • Recommendation AMF DOC-2019-15
    • AMF DOC-2019-16
    • AMF DOC-2019-17
    • AMF DOC-2019-18.