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Italy’s Efforts to Combat Money Laundering and Terror Financing: An Update

Rome, Italy - Since 2015, Banca d’Italia has been refining its supervisory priorities over the banking sector using a risk-based model developed in cooperation with the Italian Financial Intelligence Unit (UIF). The model provides residual money laundering/terror financing (ML/TF) risk scores for supervised banks based on automated inherent risk scores and vulnerability assessments by supervisors.

Refining the Risk-Based Model

According to sources, Banca d’Italia is finalizing an ambitious project to revise its AML/CFT risk-based model. This new approach will leverage the strong cooperation between the bank, UIF, and other authorities to identify high-risk transactions and individuals. The revised model will also incorporate machine learning algorithms to improve its accuracy.

Enhancing Financial Intelligence

The UIF has been working closely with law enforcement agencies to analyze suspicious transaction reports (STRs) and other intelligence. The unit’s financial analysts have developed sophisticated techniques such as data mining, machine learning, and network analytical tools to identify patterns and connections between transactions.

Tax Compliance and Beneficial Ownership

Italy’s AML authorities have also been successful in identifying and tracking beneficial ownership structures. The UIF has been working closely with the Revenue Agency to share information and prevent tax evasion. The centralized Register of Bank Accounts and the “Anagrafe Tributaria” are key tools used by investigators to track financial transactions.

Enforcing Targeted Financial Sanctions

Italy has also been at the forefront of enforcing targeted financial sanctions against Russia and Belarus. The UIF, alongside Banca d’Italia, IVASS, and Consob, has called on operators to comply with European Union sanctions. The unit has also facilitated the dissemination of information on designated entities and assisted in interpretations.

Registers and Procedures

Italian AML authorities can rely on a range of effective databases, including:

• Register of financial accounts held in Italy at the Revenue Agency
• Public Business Register that hosts data on beneficial owners

These registers have been instrumental in identifying high-risk transactions and individuals.

Conclusion

In conclusion, Italy’s efforts to combat money laundering and terror financing have been yielding positive results. The country’s AML authorities are working closely together to identify and track suspicious transactions, improve financial intelligence, and enforce targeted sanctions. With its robust framework and effective databases, Italy is a shining example of how to effectively prevent and detect financial crimes.

Sources

• Banca d’Italia
• Italian Financial Intelligence Unit (UIF)
• Revenue Agency
• Public Business Register