Financial Crime World

Financial Institutions Must Comply with International Sanctions and Anti-Money Laundering Regulations

Introduction

The Netherlands’ financial institutions have a critical role to play in preventing money laundering, terrorist financing, and other illicit activities. To achieve this goal, the government has implemented various laws and regulations that impose obligations on financial institutions.

Key Regulations

Sanctions Act

  • Requires financial institutions to use sanctions lists to check if their relationships match those of sanctioned individuals or entities.
  • If a “hit” is found, the institution must report it immediately.

Wire Transfer Regulation 2 (WTR2)

  • Designed to improve the traceability of funds transfers and prevent money laundering and terrorist financing.

Act on the Supervision of Trust Offices 2018 (Wtt)

  • Aims to protect the integrity of the financial system by regulating trust offices.
  • Ensures that pension funds have robust integrity risk management in place.

Regulation implementing the Anti-Money Laundering and Anti-Terrorist Financing Act

  • Provides further rules for combating money laundering and terrorist financing.

Guidelines

Dutch Central Bank (DNB) Guidelines

  • Provide clarification on statutory obligations and compliance tools.
  • Complemented by the Ministry of Finance and Justice’s General Guideline on the implementation of the Anti-Money Laundering Act.

International Regulations

  • European Banking Authority (EBA)
    • Sets standards for combating money laundering and terrorist financing.
  • Financial Action Task Force (FATF)
    • An intergovernmental organization that sets standards for combating money laundering and terrorist financing.
    • Conducts evaluations of member countries’ compliance, which has been ongoing since 2021.

Staying Up-to-Date

  • Financial institutions are advised to regularly check the DNB’s website for policy statements, guidelines, and good practice documents.
  • This will help them stay informed about the latest developments in anti-money laundering and counter-terrorism financing regulations.