In its response to AMLA’s consultation on the draft Guidelines on ongoing monitoring of a business relationship under Article 26(5) of the AMLR, the EACB highlights both the positive aspects of the proposed approach and areas where further clarification would be beneficial.
The draft Guidelines place emphasis on proportionality, technological neutrality and the risk-based approach. They also recognise the range of information sources and technological tools that institutions may rely on to support ongoing monitoring and customer due diligence processes. However, further clarification of certain provisions would help ensure legal certainty, operational feasibility and consistent implementation across Member States.
The following key issues highlight the main areas where further clarification and adjustments to the draft Guidelines would help ensure a proportionate, practical and consistent approach to ongoing monitoring across the EU:
- Preserving a genuinely risk-based approach to customer reviews and ongoing monitoring, ensuring that customer information updates, trigger events, periodic reviews and monitoring measures remain proportionate to the ML/TF risks identified and do not result in unnecessary customer outreach, documentation requests or compliance burdens.
- Clarifying the distinction between customer information updates and customer due diligence reviews, and confirming that customer information may, where appropriate, be updated through automated processes, reliable external sources or existing information already held by institutions, without systematically re-performing CDD measures or requesting customer intervention.
- Providing greater legal certainty and harmonised interpretations of key concepts, including "reliable and independent sources", "necessary steps", trigger events and the notion of a "person purporting to act on behalf of the customer", in order to promote consistent implementation and supervisory expectations across the EU.
- Ensuring that customer review and monitoring obligations remain operationally feasible and proportionate, particularly regarding identity document updates, event-driven reviews and information requirements that may generate significant implementation costs while delivering limited additional AML/CFT value.
- Maintaining a proportionate and risk-sensitive approach to transaction monitoring, including clearer distinctions between transaction monitoring, activity monitoring and payment screening, while ensuring that monitoring expectations are calibrated to the risks associated with products, services, customers, delivery channels and geographical exposures.
- Providing further clarification on expectations relating to pre-transaction and real-time monitoring, ensuring that any future approach remains risk-based, operationally workable and compatible with existing payment processing frameworks, including correspondent banking activities and instant payments.