Financial Crime World

Sweden Taps Brakes on Counter-Terrorism Financing Regulations: Proposes Changes to AML Rules

The Swedish Financial Supervisory Authority (SFSA) has proposed significant amendments to its anti-money laundering and counter-terrorism financing regulations, aiming to reduce the burden on companies while maintaining national security. The changes are expected to come into effect by March 26, 2024.

Key Changes

  • Mandatory appointment of an Anti-Money Laundering/Counter-Terrorism Financing Officer (AML Officer) will no longer be required under certain conditions.
  • Companies must only appoint an AML Officer if their operations are deemed complex enough to warrant it.
  • Tasks typically assigned to the AML Officer can be delegated to third-party providers, but not outsourced entirely.
  • Companies without an appointed AML Officer must establish a control function for regulatory compliance.

Extended Responsibilities of the AML Officer

The proposal also includes extending the list of tasks performed by the AML Officer to include:

  • Mandatory reporting to the board of directors and management regarding efforts against money laundering and terrorism financing. This report will need to be submitted at least annually.

Consultation and Compliance Steps

Companies affected by these proposed changes must respond to a consultation launched by the SFSA by January 24, 2024. To maintain compliance, companies should take the following steps:

  • Conduct an internal assessment of whether it is necessary to appoint an AML Officer, taking into account factors such as turnover, employee numbers, and products/services provided.
  • Document the assessment and parameters used in making the decision.
  • If no AML Officer is appointed, establish a control function for regulatory compliance or ensure existing functions cover AML obligations, including reporting to the Police Authority.
  • Evaluate whether delegating tasks to third-party providers might be suitable.
  • Update relevant internal governance documents according to decisions made regarding the AML Officer and other changes resulting from the amended regulations.
  • Establish a routine for internal reporting on compliance with AML rules to management.

Guidance

For guidance on navigating these proposed changes, companies can contact law firm Bird & Bird.