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Italy’s Financial Authorities Unite Against Money Laundering and Terror Financing
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Rome, Italy - In a bid to strengthen its fight against money laundering (ML) and terrorist financing (TF), the Italian financial authorities have launched several initiatives aimed at improving their risk-based model for assessing ML/TF risks.
New Methodologies for Assessing AML/CFT Risks
According to a recent report, Banca d’Italia, IVASS, and Consob have developed new methodologies to assess the AML/CFT risk of banks, insurance undertakings, and auditors. The models use data from:
- Prudential and suspicious transaction reporting
- AML/CFT information reports
Banca d’Italia’s model uses machine learning algorithms to analyze financial transactions and identify suspicious activity.
IVASS’s model assesses the ML/TF risk of insurance undertakings based on their business activities and relationships.
Consob’s model evaluates the ML/TF risk of auditors based on their clients’ activities and transactions.
Strengthened Coordination and Cooperation
The Italian authorities have also strengthened their coordination and cooperation in enforcing financial sanctions against Russia and Belarus. The UIF and the Guardia di Finanza are working together to implement and enforce EU sanctions, using the same powers they have for preventing ML/TF.
Key Strengths of Italy’s System
One of the key strengths of Italy’s system is its ability to use the same set of powers for implementing EU sanctions as it does for preventing ML/TF. This has enabled timely and effective implementation of sanctions, resulting in the freezing of assets and economic resources of significant amounts.
Italy’s approach has also proven effective in reconstructing corporate chains that allowed direct or indirect imputability of economic resources to entities designated by the EU, even in cases where imputability was hampered by the presence of corporate schemes or tools used to circumvent the European sanctions framework.
Effective Databases
Italy’s financial authorities are also relying on a range of effective databases, including:
- The Register of financial accounts held in Italy at the Revenue Agency
- The registers of beneficial owners
These databases provide valuable information for financial analyses and investigative purposes.
International Recognition
The Italian authorities’ efforts have been recognized internationally as a model of effective cooperation between financial authorities to combat ML/TF. The country’s robust framework has also been praised for its ability to prevent tax evasion and ensure transparency in financial transactions.