EBA hands AML supervision to new AMLA in Frankfurt

The European Banking Authority formally transferred its anti-money laundering and combating the financing of terrorism supervisory powers to the newly established EU Anti-Money Laundering Authority (AMLA) on 1 January 2025. The handover activates direct EU-level supervision under the single AML rulebook, consolidating fragmented national regimes across 27 member states into one enforcement apparatus based in Frankfurt.

• Regulator's line: AMLA assumes responsibility for direct supervision of high-risk financial institutions and designated money service providers identified under EU Risk-Based Approach rules.
• The number: AMLA begins with direct oversight of around 40 large cross-border banking groups and payment firms deemed systemic to EU financial stability.
• Timeline: The authority becomes operational immediately, replacing EBA's coordination role with binding supervisory decisions enforceable across member states without national gateway approval.
• For compliance teams: Direct AMLA supervision means single point contact for AML policy, reporting templates, and enforcement action, replacing dual EBA and national regulator interface.

This transfer signals the end of de facto national AML autonomy. Compliance teams managing cross-border EU operations now face consolidated examination standards, unified penalty frameworks, and faster enforcement timelines. AMLA's founding mandate includes on-site inspections, transaction-level investigation authority, and direct power to issue binding remediation orders without member state sign-off. Watch for AMLA's first supervisory letters on data quality and beneficial ownership screening standards by Q2. Your compliance infrastructure should prepare for tighter documentation requirements and faster response turnarounds to direct AMLA requests. The divergence between national FIU standards and AMLA expectations will be the main compliance flashpoint over the next 18 months.

Toronto-Dominion Bank pleaded guilty to conspiracy to commit money laundering and agreed to $1.8 billion in combined penalties following a US investigation. Between 2018 and 2024, the bank failed to monitor 92 percent of its transaction volume, enabling criminal networks to launder tens of millions of dollars through employee-facilitated accounts.

• Regulator's line: DOJ charged TD with willfully ignoring anti-money laundering obligations while staff members actively facilitated suspicious customer accounts and cash deposits.
• The number: $1.8 billion covers DOJ criminal penalty, OCC civil penalty, and FinCEN enforcement action across multiple US agencies.
• Timeline: Six-year compliance failure spanned 2018 to 2024, with systematic monitoring gaps across multiple branches and account types.

This settlement exposes institutional AML breakdown at scale. TD's guilty plea signals regulators will prosecute banks where staff complicity meets systemic deficiency in transaction monitoring. For compliance teams, the case reinforces that sampling-based monitoring and understaffed control functions create legal exposure. Review your transaction coverage percentages now, particularly for high-risk jurisdictions and employee-facilitated accounts.

The Anti-Money Laundering Authority conducted its inaugural public hearing on draft Regulatory Technical Standards, signalling the shift from institution-building to active rulemaking. The standards adopt a cross-sector approach to customer due diligence covering both financial institutions and non-financial businesses. Direct supervision begins in 2027 from AMLA's Frankfurt headquarters, with the first 40 firms identified for enhanced compliance monitoring.

• Scope: Draft RTS establishes horizontal CDD requirements spanning banks, investment firms, payment service providers, and designated non-financial businesses.
• Supervision start: AMLA commences direct oversight of major firms in 2027, moving beyond the current advisory and coordination phase.
• First cohort: Forty firms will face enhanced compliance requirements under new AMLA rules, with names to be announced separately.

Compliance teams should treat this hearing as advance notice of substantive rule changes. The cross-sector framing suggests AMLA will not tolerate sectoral exemptions or bespoke interpretations of CDD obligations. Review your current KYC documentation against the hearing transcript once published. Expect final RTS within six months and prepare for operational changes before 2027 supervision begins.

The EU AML Authority held its inaugural public hearing on draft Regulatory Technical Standards under Article 28(1) AMLR. The standards establish a unified AML framework spanning financial and non-financial sectors, applying directly to the first 40 firms under AMLA's supervision. This marks AMLA's shift from institutional setup to active standard-setting.

• Regulator's line: AMLA is building cross-sector horizontal standards to ensure consistent AML obligations across banking, insurance, crypto, and other supervised entities.
• What changed: The RTS moves beyond sector-specific rules, requiring the same core controls from all 40 directly supervised firms regardless of business type.
• Next steps: AMLA will review hearing feedback and publish final standards by early 2025, with implementation deadlines likely following shortly after.

Compliance teams at affected firms should map current controls against the draft RTS now. The horizontal approach signals AMLA's intent to close cross-sector loopholes. This public hearing process suggests the final standards will reflect industry input, but material changes are unlikely. Prepare for tighter governance requirements and documentation standards.