Financial Crime World

BELGIUM TIGHTENS GRIP ON FINANCIAL CRIME WITH ROBUST AML REGULATIONS

In a bid to tackle the scourge of money laundering and terrorism financing, Belgium has implemented a comprehensive set of Anti-Money Laundering (AML) and Counter-Terrorist Financing (CFT) regulations. The country’s financial landscape, which attracts institutions and service providers from across the European Union and beyond, is now subject to stringent record-keeping and reporting requirements.

MONEY LAUNDERING PROHIBITED IN BELGIUM

Belgium has outlawed money laundering through the Law of January 11, 1993, with Article 505 of the Penal Code imposing a maximum penalty of five years’ imprisonment. The country’s domestic legislation, which incorporates Council Directive 2001/97/EC on preventive measures for the use of the financial system for money laundering, was expanded in 2010 to include a broader range of money laundering predicate offenses.

REGULATORY OVERSIGHT

The Belgian Banking and Finance Commission (CBFA) is responsible for overseeing financial institutions, including exchange houses, stock brokerages, and insurance firms. Casinos fall under the jurisdiction of the Belgian Gaming Commission, while professions not regulated by the CBFA are overseen by CTIF-CFI. The Financial Services and Markets Authority (FSMA), established in 2011, operates as an autonomous public organization responsible for safeguarding Belgium’s financial system and ensuring AML/ CFT compliance.

FSMA: THE APICAL REGULATORY BODY

The FSMA is entrusted with monitoring the fair and orderly functioning of Belgium’s financial markets. To achieve this, it collaborates closely with the National Bank of Belgium, focusing on six key objectives:

  • Monitoring and supervision of financial markets
  • Ensuring institutional compliance with business norms
  • Oversight of financial products

CONDUCT REGULATIONS

The FSMA issues conduct guidelines that apply to all financial institutions operating in Belgium, aimed at ensuring equitable and consistent treatment of financial services and products across the industry. These guidelines also uphold stringent safety standards.

AML/CFT REGULATIONS IN BELGIUM

Belgium has amended its legislation to incorporate the European Union’s Anti-Money Laundering Directives (AMLD), including the Fifth Anti-Money Laundering Directive (5AMLD) and the Sixth Anti-Money Laundering Directive (6AMLD). These regulations cover:

  • Cryptocurrency service providers
  • Prepaid cards
  • High-value commodities transactions
  • Additional beneficial ownership measures

PENALTIES FOR NON-COMPLIANCE

Noncompliance with money laundering regulations in Belgium carries severe penalties, including:

  • Fines of up to €800,000 for individuals
  • Fines of up to €1.6 million for businesses
  • Individuals found guilty of AML compliance violations may incur fines of up to €5 million
  • Businesses could face penalties amounting to 10% of their previous year’s earnings
  • Those who obstruct AML investigations risk penalties of up to €5 million and a year of imprisonment

CONCLUSION

Belgium’s robust AML regulations demonstrate its commitment to combating financial crime and ensuring the integrity of its financial system.