The Sixth Anti-Money Laundering Directive (6MLD) is a European Union regulation that builds upon the framework established by the Fifth Anti-Money Laundering Directive (5MLD) to further strengthen measures against money laundering and terrorist financing.
6MLD expands on the list of predicate offenses established in 5MLD by including additional criminal activities, such as cybercrime, environmental crime, and tax crimes. By widening the scope of predicate offenses, 6MLD aims to better address the evolving nature of financial crime and ensure that financial institutions take appropriate measures to prevent money laundering and terrorist financing.
The directive enhances due diligence requirements for financial institutions, requiring them to implement more rigorous customer identification and verification processes, as well as ongoing monitoring of transactions and relationships. This helps to identify suspicious activities and mitigate the risk of financial crime more effectively.
6MLD introduces more stringent penalties for non-compliance, with the possibility of fines up to €5 million or 10% of an organisation's annual turnover for legal persons (i.e. corporate bodies), and up to €1 million for natural persons (i.e. sole proprietors, partnerships etc). Additionally, it mandates that EU Member States implement effective, proportionate, and dissuasive criminal penalties for money laundering, which may include imprisonment.
For financial institutions, it is crucial to be aware of and adhere to the requirements outlined in 6MLD. Implementing robust anti-money laundering (AML) and counter-terrorist financing (CTF) policies and procedures will not only ensure compliance with the directive but also contribute to the ongoing global effort to combat financial crime.