The European Parliament has endorsed a series of regulations designed to strengthen the EU’s Anti-Money Laundering (AML) and counter-terrorist financing framework, particularly focusing on the cryptocurrency sector.

These regulations involve the introduction of more stringent due diligence procedures and customer identity verification protocols. Entities such as banks and cryptocurrency asset managers are required to promptly alert Financial Intelligence Units (FIUs) or relevant authorities of any suspicious activities, indicating an increased level of scrutiny within the cryptocurrency domain.

Under the new laws, FIUs are empowered to enhance their scrutiny and detection capabilities regarding money laundering and terrorist financing, as well as to intervene in questionable transactions. Additionally, the creation of the Authority for Anti-Money Laundering and Countering the Financing of Terrorism (AMLA) in Frankfurt is tasked with overseeing the enforcement of these regulations. AMLA will supervise high-risk financial entities, address regulatory breaches, act as a central supervisory body, resolve disputes among supervisors, and enforce targeted financial sanctions.

The legislative package includes the sixth AML directive, the EU’s “single rulebook” regulation, and the AMLA regulation.

Moreover, these regulations grant individuals with a “legitimate interest,” such as journalists, civil organizations, competent authorities, and supervisory bodies, unrestricted access to beneficial ownership information stored in national registries interconnected at the EU level for at least five years.

Additionally, the legislation introduces enhanced monitoring measures for ultra-high-net-worth individuals (with wealth exceeding €50,000,000, excluding their primary residence), establishes an EU-wide cash payment cap of EUR 10,000 (excluding non-professional private transactions), and implements mechanisms to ensure compliance with targeted financial sanctions and prevent their circumvention.

Significantly, leading football clubs will be obligated to verify customer identities, monitor transactions, and promptly report any suspicious activities to FIUs for high-value transactions starting in 2029.

Ilya Brovin, the chief growth officer at Sumsub, praised the EU’s latest AMLR regulations as a crucial response to the changing strategies of criminal elements leveraging technology. He highlighted that these regulations signify a substantial step towards fostering a secure and transparent cryptocurrency industry, deserving recognition and support.