Today, on March 24, 2025, in Malta, under the auspices of Malta Financial Services Authority (MFSA) and the University LUISS of Rome, was held the Conference “Regulating the Future: Evolving Financial Markets, Supervision, and Sustainability in the EU” according to the following program:
1. Institutional greetings by Catherine Galea (Head – Banking Supervision, MFSA) and from Francesco Capriglione (Luiss Master Director)
2. Presentations on Banking Supervision: Anabel Armeni Cauchi (Deputy Head – Banking Supervision, MFSA) and Valerio Lemma (Full professor of Economic Law)
3. Presentations on Anti-Money Laundering: Eric Micallef (Assistant Manager – Financial Crime Compliance, MFSA and Alberto J. Tapia Hermida (Full professor of Commercial Law, University Complutense Madrid)
4. Presentations on DORA for Banks: Fabiana Di Porto (Associate professor of Economic Law) and Marco Bodellini (Associate professor of Economic Law).
5. Presentations on ESG in the Banking Sector: Giuseppe Inserra (Senior Analyst – Banking Supervision, MFSA), Federico Riganti (Associate professor of Economic Law); and Francesco Affinito (Research fellow of Economic Law).
I had the honour and pleasure to appear at this International Conference to give a presentation on “The regulation of money laundering prevention in Spain”. in keeping with the custom of this blog, I offer your readers a brief summary of my presentation:
1. Context: Regulation in the EU. The upcoming implementation, as of July 1, 2025, of the European Anti-Money Laundering Regulation 2024
Regulation (EU) 2024/1620 of the European Parliament and of the Council of 31 May 2024 establishing the Authority for Combating Money Laundering and Terrorist Financing and amending Regulations (EU) No 1093/2010, (EU) No 1094/2010 and (EU) No 1095/2010 aims at establishing the Authority for Combating Money Laundering and Terrorist Financing, which “shall act in accordance with the powers conferred by the Regulation and within the scope of Regulation (EU) 2023/1113, Directive (EU) 2024/1640 and Regulation (EU) 2024/1624, as well as all directives, regulations and decisions based on those acts, any subsequent legally binding Union act conferring tasks on the Authority, and national legislation transposing Directive (EU) 2024/1640, and other directives conferring tasks on supervisory authorities” (Art. 1). The European Commission shall be responsible for the establishment and initial operation of the Authority until 31 December 2025 (Art.107).
This Regulation (EU) 2024/1620 will be applicable, in general terms, as of July 1, 2025; notwithstanding that its sections 1, 4, 49, 53, 54, 55, 57 to 66, 68 to 71, 100, 101 and 107 have become applicable as of June 26, 2024 and section 103 will be applicable as of December 31, 2025 (Art.108).
Moreover, it is appropriate to complete this context, taking into account the EU Council Conclusions on the revised EU list of non-cooperative countries and territories for tax purposes (C/2025/1473) published in the OJEU of February 28, 2025.
2. Regulation in Spain
Act 10/2010, of April 28, 2010, on the prevention of money laundering and the financing of terrorism (BOE No. 103, of April 29, 2010) aims to “protect the integrity of the financial system and other sectors of economic activity by establishing obligations for the prevention of money laundering and the financing of terrorism” (art.1.1)
According to the Act 10/2010, the conversion or transfer of property; the concealment or disguise of the nature, source, location, disposition, movement or beneficial ownership of property or rights over property; the acquisition, possession or use of property; participation in any of the above activities; etc.) shall be considered money laundering under certain conditions (art.1.2).
According to the Act 10/2010, financing of terrorism shall mean the supply, deposit, distribution or collection of funds or property, by any means, directly or indirectly, with the intention of using them or with the knowledge that they will be used, in full or in part, for the commission of any of the terrorist offenses defined in the Penal Code (art.1.3).
3. Application in Spain
3.1. The SEPBLAC Recommendations on internal control measures for the prevention of money laundering and terrorist financing
Section 26 of Act 10/2010 on the prevention of money laundering and terrorist financing establishes, with the exceptions to be determined by regulation, a series of internal control obligations for regulated entities. These obligations include the approval and implementation of prevention policies and procedures, the establishment of adequate internal control bodies responsible for their application and the approval of a prevention manual.
In order to make it easier for regulated entities to comply with the obligations established in Section 26 and within the framework of the provisions of Section 45.4.g) of Act 10/2010, The Executive Service of the Commission for the Prevention of Money Laundering and Monetary Offenses SEPBLAC has issued the “Recommendations on internal control measures for the prevention of money laundering and terrorist financing”. It is not a standard in the strict sense but a guide that in any case has to be adapted to the reality of each obliged subject.
The document consists of a brief regulatory framework, a section on general principles and a final section specifying the internal control recommendations that regulated entities must take into account when drawing up their prevention manuals and procedures. It warns that “all these control measures must be described in as much detail as possible, including all the necessary information to provide an in-depth knowledge of their characteristics, operation and application”.
Specifically, there are 18 Recommendations that refer to the “Risk self-assessment report on money laundering and terrorist financing” (3.1); to “Internal regulations” (3.2); to “Internal organization” (3.3); to “Responsibility of directors and managers” (3.4); to “Customer admission policy” (3.5); to “Due diligence measures and their application” (3.6); to “Retention of customer and transaction documentation” (3. 7); to the “Systematic reporting of transactions” (3.8); to the “Detection and analysis of transactions likely to be related to money laundering or terrorist financing” (3..9); to the “Refraining from execution” (3. 10); to the “Communication of operations susceptible of being related to money laundering or financing of terrorism” (3.11); to the “Compliance with the requirements of Sepblac or other authorities” (3.12); to “Training” (3.13); to “Subsidiaries in Spain or abroad and branches” (3.14); to “Agents and other mediators” (3.15); to “Internal verification” (3.16); to “Review of procedures by external expert” (3.17); and to “Other relevant matters not covered by the preceding points” (3.18).
3.2. The CNMV Report of February 20, 2025 on the result of the review on the obligation of entities to analyze their risks in the prevention of money laundering
On February 20, 2015, the CNMV published the result of the review on the obligation of entities to analyze their risks in the prevention of money laundering in which it reports the following points:
A) Scope of the review
Some twenty entities under the prudential supervision of the CNMV were reviewed, including ESIs, CII managers, managers of closed-end entities and branches of EU entities. The CNMV has supervised the degree of compliance by the entities with the legal obligation to have a money laundering risk analysis.
The CNMV’s review report states that “the incidents identified have been communicated to each entity individually, warning them that the CNMV will take these issues into account in future supervisions”.
B) Positive results: application of the SEPBLAC Recommendations
The CNMV’s review report states that, “in general, the entities analyze their money laundering risks, document them in a report which is approved by their management bodies, and update them periodically”. Specifically, as mentioned above, most of the reports follow the content proposed by the Executive Service of the Spanish Anti-Money Laundering and Monetary Offenses Prevention Agency (SEPBLAC) in its document “Recommendations on internal control measures for the prevention of money laundering and financing of terrorism”.
C) Negative results: weaknesses detected
The most relevant weaknesses observed in the review carried out during 2024 were the following:
a) Lack of reference to the activity carried out by the entity
The reports of the entities «often do not give a practical view of the activity carried out by the entity. The reports should be an “X-ray of the business” by which to identify the elements of risk in order to establish an effective prevention system».
b) Absence of assessment of money laundering risks in the indirect marketing of their products or services
Specifically, this absence of assessment of money laundering risks is detected in two hypotheses of indirect marketing by the supervised entities of their products or services:
b.1) Marketing agreements with third parties
«The entities that have agents and those that have marketing agreements with other intermediaries should not limit themselves to reporting this, but should specify their activities and assess the risk derived. In the case of marketing by other intermediaries, the preventive responsibilities of each entity should be clarified».
b.2) Remote customer acquisition
«Some entities detail the models for acquiring eligible customers. In the event that they allow the registration of remote customers, the risk derived, which is significant in this case, should be assessed“.
c) Cash movements
”The entities inform in their analysis of the systems and channels allowed for deposits and withdrawals of customer funds. Although most of them do not allow cash movements, it is recalled that this practice also increases the risk of money laundering».
d) Absence of national and supranational risk analyses
«Few entities consider national and supranational risk analyses, such as the one published by the Treasury (see Addendum of 2024) or those prepared by the European Commission and the European Banking Authority (EBA). The need to take these analyses into account has been conveyed, as expressly established in the forthcoming 2024 European Money Laundering Regulation.»