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News / EU Is On Its Way To Completing Groundbreaking Anti-Money Laundering Law: Supper Rich Cash Transactions Limit And Football Clubs’ Dirty Money In Focus

EU Is On Its Way To Completing Groundbreaking Anti-Money Laundering Law: Supper Rich Cash Transactions Limit And Football Clubs’ Dirty Money In Focus

An updated EU directive that is likely to be completed this week may impose stricter controls on large-scale football teams, and limit the use of cash.

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The Most Anticipated Deal To Address Football’s Illicit Revenue

The EU has taken a decisive step towards clamping down on the widespread and hardly traceable money flow to both international football activities, as well as in numerous other sectors by finalizing an innovative anti-money laundering regulation. This new EU rule that is scheduled for an agreement in January 2024 would result in more strict checks for big football teams and limitations on cash usage. Although the anti-money laundering regulation stalled talks in December 2023, lawmakers and state heads are ready to now broaden its scope after global standard setters focused on football’s cash flows. This upcoming law, during the trilogue meeting scheduled for Wednesday, if agreed upon will be enacted before European elections in June and it is likely to affect big football club’s cash transactions and super-rich profiles.

Why Illegal Activities Linked With A Football Field?

Over the past twenty years, football has evolved from a national recreation to an international money laundering business. It is unquestioningly the most popular sport in the world and is watched by billions. The increasing economic significance of football and other sports has led to an unprecedented investment in this sector, some part of which is associated with criminal dealings.

The FATF has presented its analysis of what factors make football such a lucrative sector for supercriminals. Despite the dynamic developments and enormous prominence of the football industry even though, the structure of the regulations is not adjusted to some risks that might occur as a consequence of these changes. So, more scrutiny for large football teams and restrictions on cash use would result from this EU rule that is scheduled to sign in January 2024.

Lawmakers Limit Cash Transaction

The current anti-money laundering statutes provide that firms such as banks and real estate agents conduct complete KYC processes to check who their customers are. In 2024, football clubs would make similar checks but only for big transactions involving investors, agents, and sponsors, not for fans who want to get tickets. Experts have shown some uncertainty in the new law if even football agents will have to make these verifications or whether certain teams might be exempted because they pose less risk.

The Wednesday meeting would cover the newly introduced AML law that regulates cash by stopping individuals from using more than €10,00 for a single purchase even if some people wanted to fix this limit at €7,000. The lawmakers and member states in the EU have to approve these rules before they can become official.

Contributing Forces For These Strict AML Rules

The reasons for these changes are that there have been major scandals such as the one where Danske Bank was caught handling illegal Russian money. Football, too has had its woes like, Roman Abramovich had to sell Chelsea FC as he was accused of having links with Vladimir Putin. So, the EU is on a mission to put an end to the blind and unaccounted money transfers in the international football sector to keep international financial dealings transparent. With this background, banks and trust managers will have to establish where the money comes from when they handle clients who are worth more than €5 million. This is not for discriminating against wealthy customers but for using a large amount of money with caution.

The Expected Outcomes Of The Meeting

Members of the European Parliament might be successful in imposing additional controls on wealthy individuals linked with the Football sector. Even if they sign off on these rules by Wednesday, the EU must determine what country will host a new agency charged with monitoring large banks to combat money laundering. This agency will be hosted by nine cities, who will present their propositions at the end of January. Let’s hope for the best for the international community with these laws to create a more stable and responsible financial landscape.

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Published Date

January 19, 2024

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