EU names four US territories on money-laundering blacklist

Saudi Arabia, Nigeria and four overseas US territories have been named on the EU’s blacklist of territories at high risk of money laundering.

The European Commission on Wednesday pressed ahead with the publication of the name-and-shame exercise despite criticisms from its member states, led by the UK and France, about the political sensitivities of drawing up an EU-only list.

In total, 23 jurisdictions were identified by the commissioner for having “strategic deficiencies in their anti-money laundering and counter-terrorist financing frameworks”.

They include US territories Puerto Rico, Guam, American Samoa and US Virgin Islands, as well as Saudi Arabia, Nigeria, the Bahamas, Panama and Iran.

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Identification on the list means EU banks dealing with any of the named countries will have to carry out additional checks in order to identify dirty money flows. Brussels will also invite the identified territories to improve their anti-money laundering frameworks if they want to be removed from the list.

"I invite the countries listed to remedy their deficiencies swiftly," said Vera Jourova, the EU's justice commissioner. "The commission stands ready to work closely with them to address these issues in our mutual interest."

Lobbied

EU officials noted that Saudi Arabia and its allies in the US have lobbied Brussels for Riyadh to be taken off the list. At a meeting of EU28 ambassadors last week, the UK, France and Germany all expressed their reservations about the commission naming jurisdictions that have not been identified by the Financial Action Task Force, the global body that sets the standard for anti-money laundering. Of the 23 jurisdictions named by the commission, 11 are not identified by the task force.

Ms Jourova defended the commission’s toughened methodology for identifying the countries. EU governments could block the list from being approved with a qualified majority but the commissioner said it was unlikely to meet such staunch opposition.

“I am not surprised by some of the reactions but I do believe that the member states will express their full understanding for why we are doing this. It is a necessary thing to do,” she said. – Copyright The Financial Times Limited 2019