The EU's preventive AML/CFT policy: asymmetrical harmonisation

Abstract

PurposeThis article aims to consider the role of the European Union (EU) in the prevention of money laundering and to show that the EU has a lot more to win in this field of policy.Design/methodology/approachThis article is based on a literature study and a thorough analysis of the EU Directives on the prevention of money laundering.FindingsWhereas, the material norms for entities subject to regulation have been harmonised and adjusted to the risk‐based approach at European level, the norms regarding the enforcement instruments have mostly been left to the Member States' legislation. As a result, there exists a “patchwork” of enforcement mechanisms throughout the EU.Research limitations/implicationsThis article focuses on the prevention of money laundering on the level of the EU only; no connection is made to the international or to the national level.Originality/valueThis article does not provide a value judgment on the preventive rules at European level as such, but rather it offers an academic perspective on the role of the EU in the prevention of money laundering.