Centralised oversight of anti-money laundering (AML) and counter-terrorism financing (CTF) is gaining traction as governments look to combat increasingly complex, cross-border financial crimes.
According to Arctic Intelligence, a growing number of jurisdictions are moving to consolidate AML/CTF responsibilities into single authorities with broad enforcement, supervisory, and intelligence functions. This article explores the potential of these centralised bodies and the challenges they must overcome.
AML/CTF consolidation authorities are designed to unify efforts that are often dispersed across multiple agencies. By integrating regulatory oversight, enforcement, and intelligence-gathering under one roof, these bodies aim to streamline compliance efforts and eliminate inefficiencies. One notable example is the European Union’s Anti-Money Laundering Authority (AMLA), set to launch in 2026, which will oversee high-risk institutions and promote consistency across member states. In the U.S., the Financial Crimes Enforcement Network (FinCEN) serves as an established model for a centralised approach.
The drive toward centralisation stems in part from the fragmented nature of existing AML/CTF frameworks. Many countries divide responsibilities among regulators, financial intelligence units, and law enforcement agencies, resulting in delays, duplicated efforts, and gaps in enforcement. By consolidating these functions, governments hope to establish a more unified and agile response to financial crime. Centralised authorities also improve cross-border coordination by serving as a single point of contact, which is critical given the global nature of money laundering and terrorist financing.
Among the key functions of these authorities are supervisory oversight of high-risk institutions, policy development aligned with global standards, robust enforcement powers, and data-driven intelligence sharing. Additionally, they often engage in capacity building by providing training and resources to industry stakeholders and regulators.
There are clear benefits to this model. Streamlined operations can lead to faster decision-making, while central bodies are often better positioned to attract top-tier talent. Risk-based resource allocation can ensure efforts are focused on the highest threats. International collaboration is also enhanced, allowing consolidated authorities to work more effectively with global partners like the Financial Action Task Force (FATF).
However, consolidation comes with significant challenges. The transition itself can be resource-intensive and politically sensitive, particularly in regions where national regulators have well-established roles. There is also a risk of overreach, with concerns that central authorities may wield too much power without sufficient accountability. Issues around data privacy and cyber risks also loom large, especially when sensitive financial intelligence is housed in centralised systems.
Examples of centralised AML/CTF regimes demonstrate both promise and complexity. AMLA will work alongside EU member state regulators to reduce fragmentation. In the U.S., FinCEN acts as a coordination hub for financial intelligence. Singapore offers another model, with the Monetary Authority of Singapore (MAS) functioning as the lead AML/CTF regulator in a system noted for its effectiveness and streamlined compliance structure.
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