Frankfurt has become the most suitable location for the headquarters of the European Anti-Money Laundering and Counter-Terrorism Financing (AML/CFT) agency.

The decision was taken following a voting process on February 22. Frankfurt beat other major cities such as Paris, Madrid and Rome. It is part of wider reforms following a series of high-profile money laundering scandals.

Frankfurt beat other leading contenders including Paris, Madrid and Rome in a competitive vote held on Thursday, February 22. The outcome of this vote could serve as a precedent for future decisions on the location of EU institutions.

In an interview with reporters, Mairead McGuinnes of the European Commission emphasized the importance of solving the problem of dirty money infiltrating the financial system. She noted that alarm bells about illicit money laundering have been widespread in recent years and said those calls were heeded that night.

The choice of venue represents the final stage of the EU's AMK/CFT reforms, which have introduced restrictions on large cash transactions and introduced tighter identity checks on football agents and sponsors.

scandals of the past

AMLA's debut follows a series of scandals, including Danske Bank's admission of laundering hundreds of billions of dollars in illegal Russian funds through its Tallinn branch. Financial institutions such as Malta’s Pilatus Bank and Latvia’s ABLV also collapsed.

In the race among nine contenders for the headquarters of the Anti-Money Laundering Act, officials were skeptical about the eventuality of the outcome - until the very end.

In the final round of confidential voting, Frankfurt received 28 votes, Madrid received 16, Paris received 6 and Rome received 4, Chief Councilor Eva Maria Poptcheva (Spain/Renew Europe) told reporters.

On 18 January, Parliament and the Council reached a political agreement on the proposals for the first AML/CFT Regulation and the sixth AML/CFT Directive.

In December 2023, co-lawmakers agreed on AMLA regulations. Additionally, in June 2022, they reached an agreement on revised regulations regarding fund traceability and crypto asset transfers.

These legislative texts establish a unified AML rulebook and form the basis for coordination efforts between the new AML law and national authorities.

combat money laundering

Money laundering in the cryptocurrency space has taken center stage, with criminals increasingly using digital assets to conceal illicit proceeds.

Recent data and trends highlight the benefits and challenges cryptocurrencies pose to anti-money laundering (AML) efforts.

ChainAnalysis’ 2021 report highlights the scale of global cryptocurrency money laundering, which amounted to $8.7 billion for the year. While that's down from previous years, the cumulative total since 2017 is more than $33 billion.

The main strategies employed in cryptocurrency money laundering include the use of privacy coins to enhance anonymity. It mixes services that mask the source of funds with the utilization of intermediary services such as personal wallets and decentralized finance platforms.

However, governments and regulators around the world are increasing their efforts to combat cryptocurrency-related money laundering through strengthening anti-money laundering frameworks, legislative measures and increasing international cooperation among law enforcement agencies.

Additionally, the latest findings from the ChainAnalysis 2022 report highlight the extent of illicit activity in the cryptocurrency space. Specifically, four exchange deposit addresses have received more than $1 billion in illicit funds this year, highlighting the ongoing challenges in combating cryptocurrency-related money laundering.

On February 20, blockchain analysts at Cyvers Alerts published a post on X announcing the results of an investigation that revealed unusual transactions in wallets allegedly owned by AAX. Just two days after FTX went bankrupt, the cryptocurrency exchange halted all withdrawals, sparking scrutiny.

According to the investigation, more than $55.5 million worth of Ethereum (ETH) was transferred from AAX wallets in early February.

The transactions were orchestrated by unidentified entities with the aim of laundering money through decentralized exchange (DEX) platforms such as UmbraCash and 1inch. #欧盟 #反洗钱