Daily Dash: Bulgaria Has Strengthened Its Anti-Money Laundering Framework, Says MONEYVAL

May 30, 2024
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Bulgaria’s efforts to prevent money laundering and terrorist financing have received praise from MONEYVAL, while the Bank of Israel has launched a new developer challenge to find use cases for central bank digital currency.

Bulgaria Has Strengthened Its AML/CTF Framework, Says MONEYVAL

Bulgaria has improved its anti-money laundering and counter-terrorism financing (AML/CTF) measures, MONEYVAL's new follow-up report has found.

Since its adoption of a mutual evaluation report in May 2022, MONEYVAL found that Bulgaria has improved its compliance with ten of the Financial Action Task Force’s (FATF) Recommendations.

These include recommendations on national cooperation and coordination, politically exposed persons, money or value transfer services and regulation and supervision of financial institutions.

Out of the 40 applicable FATF Recommendations that MONEYVAL reviewed in its latest report, Bulgaria is now rated as compliant or largely compliant with 27 and partially compliant with 13.

Bulgaria is expected to report back to MONEYVAL within one year’s time on progress to strengthen its implementation of AML/CTF measures.

Bank Of Israel Searches For CBDC Use Cases In New Developer Challenge

The Bank of Israel (BOI) has launched a "digital shekel challenge" to encourage developers to find innovative use cases for a potential central bank digital currency (CBDC).

The BOI has built a “technological prototype” for the challenge, simulating a digital shekel system at the central bank and its application programming interface (API) layer.

Payment service providers (PSPs) and other service providers will receive access to the system and will be able to develop products for end users among the general public.

"The digital shekel challenge is another step towards the means of payment of the future, with the aim of creating an innovative and competitive payments ecosystem,” said BOI deputy governor Andrew Abir.

“The success of the digital shekel will depend on cooperation between the Bank of Israel and the private and government sectors.”

The challenge is the first time that the BOI has allowed the payments industry, both at home and abroad, to work with the central bank on planning and designing a digital shekel.

BaFin Lifts N26 Customer Cap Following AML Improvements

Germany's Federal Financial Supervisory Authority (BaFin) has fully lifted N26’s growth restriction effective as of June 1, 2024.

The growth cap was imposed by BaFin in 2021 along with a €4.25m fine for N26's failure to install effective money laundering controls.

At first, the company was able to take on up to 50,000 new customers per month, and the cap was later raised to 60,000 per month.

“We are pleased about the trust of our regulators and will continue our close exchange in the future," said Valentin Stalf, CEO of N26.

"In recent years, we have been able to make significant progress in preventing and combating money laundering and financial crime.”

Despite the lifting of the onboarding cap, a BaFin-enforced special representative will continue in place at the company until the end of 2024.

Thai SEC Seeks Public Feedback On Proposed Digital Assets Act

The Thai Securities and Exchange Commission (SEC) is consulting on the Digital Assets Act, with the aim of overhauling the country’s regulatory framework for crypto-assets.

This new legislation is set to replace the 2018 Decree on Digital Assets, which was originally introduced as an emergency measure, and stakeholders have until July 22 to respond. 

The consultation targets various aspects of crypto-asset businesses, establishing approval procedures for public offerings and detailing licensing requirements for operators. 

Additionally, it specifies the criminal and civil penalties for failing to comply with the act.

CPMI Outlines Strategic Priorities For 2024-25

The Bank for International Settlements' Committee on Payments and Market Infrastructures (CPMI) has published its work programme for 2024-25, emphasising key strategic priorities across policy, standard-setting, implementation and analysis.

A key focus is on the enhancement of cross-border payments, where CMPI seeks to improve the efficiency, speed and accessibility of international transactions.

The risk management of financial market infrastructures is another priority, aimed at strengthening frameworks to ensure the resilience and stability of financial systems. 

Additionally, the CPMI is prioritising digital innovation in payments, clearing and settlement. This involves leveraging new technologies to modernise payment systems and market infrastructure.

“With its work programme, the CPMI continues to promote the safety and efficiency of payments and financial market infrastructures, advancing standard-setting work on relevant risk management,” said Fabio Panetta, CMPI chair and governor of the Bank of Italy. 

Panetta continued that the CPMI will play a leading role in addressing obstacles to faster, cheaper, more transparent and inclusive cross-border payments, as well as “contributing to policy-oriented thought leadership in digital innovations in payments”. 

Swedish Bankers’ Association Highlights Challenges With Gambling On Credit Ban

The Swedish Bankers’ Association has responded to the proposed ban on gambling with credit, supporting its aim but also highlighting what it thinks will be key challenges.

The trade association has said that there are likely to be significant technical limitations as current systems can only detect and block credit card payments, leaving other forms of credit unmonitored.

There is also ambiguity in enforcement, the group says, meaning it is unclear how non-credit card transactions can be reliably identified as gambling-related.

Lastly, potential loopholes pose a concern. Players might exploit "decoupled cards" funded by credit cards, which would bypass the ban's intent. 

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