The European Banking Authority (EBA) has launched its central database for AML/CFT, known as the European Reporting System for Material CFT/AML Weaknesses or EuReCA. EuReCA will help coordinate the actions of authorities and the EBA to mitigate ML/TF risks in the European Union (EU).
EuReCA will share information on material weaknesses in EU-based financial institutions that authorities have identified previously. Internal audit reports, prepared by authorities during onsite inspections, are also included on EuReCA, even in the cases where no remedial actions were taken despite the senior management being aware of the issues. Further, authorities will share the steps they asked deficient financial institutions to implement in order to overcome their weaknesses.
Lack of adequate AML/CFT policies, including those related to transaction monitoring and high-risk customers, increases the ML/TF risk in a financial institution. Information shared on EuReCA will help the EBA to reassess its view of ML/TF risks to the EU financial sector. Information from EuReCA will also aid authorities at various stages. Particularly, it will act as an early warning tool so they can take adequate action before facing an ML/TF risk.
Source: European Banking Authority