AI SUMMARY – What you should know before reading
- The European Union is establishing a new authority to combat money laundering.
- The agency, known as AMLA, will be based in Frankfurt.
- Full operational capacity is expected by 2028.
- Crypto assets and new payment methods are key regulatory priorities.
Main Article
The European Union is moving to strengthen its defenses against financial crime by establishing a new centralized authority dedicated to combating money laundering and terrorist financing. The Anti-Money Laundering Authority, known as AMLA, will be headquartered in Frankfurt am Main and is expected to become fully operational in 2028, according to an announcement made this week.
The creation of AMLA follows years of concern over the EU’s fragmented approach to financial supervision. A series of high-profile scandals exposed weaknesses in national oversight systems, revealing how criminal networks exploited regulatory gaps across borders. In response, EU lawmakers proposed the establishment of a single supervisory body in 2021, marking a significant shift toward centralized enforcement.
Unlike existing coordination mechanisms, AMLA will have direct supervisory powers. It will oversee approximately 40 of the bloc’s highest-risk financial institutions, including banks, payment firms, and companies providing crypto asset trading and custody services. In cases of serious or repeated violations, the authority will be able to impose sanctions.
AMLA officials said the agency will finalize its risk assessment methodology later this year, laying the groundwork for selecting supervised entities in 2027. Staffing is also progressing steadily. The authority has already hired 120 employees, meeting its interim recruitment target, with plans to expand to more than 400 staff members in the coming years.
A central focus of AMLA’s mandate will be emerging risks linked to technological innovation. Cryptocurrencies and alternative payment systems have transformed financial markets but also created new channels for illicit activity. Experts estimate that more than $80 billion was laundered through crypto assets last year, a sharp increase compared with figures from five years earlier.
Despite this growth, officials caution that most terrorist financing still relies on conventional financial methods, including cash-based transactions. AMLA’s challenge will be to balance attention between cutting-edge digital risks and long-standing vulnerabilities in traditional finance.
AMLA’s director, Bruna Szego, described the new authority as a turning point for Europe’s anti-money laundering framework. She said the EU is moving away from fragmented national responses toward a unified, risk-based system capable of addressing the complexity of modern criminal networks.
As Europe’s first authority of its kind, AMLA represents an ambitious attempt to safeguard the integrity of the EU’s financial system. While its full deployment remains several years away, policymakers view the gradual rollout as essential to ensuring effective governance and long-term credibility.