Which two statements are true regarding the European Union Money Laundering Directives? (Choose two.)

Question

Options

• AThey apply to member states of the European Union
• BThey require member states to enact laws and/or regulations to comply with the directives
• CThey set forth non-binding best practices for financial institutions within the member states
• DThey have extraterritorial impact and apply to states that have diplomatic relations with member

• A
  84% (16)
• C
  5% (1)
• D
  11% (2)

Explanation

The European Union Money Laundering Directives (AMLDs) are issued periodically by the European Parliament to prevent money laundering and terrorist financing and establish a consistent regulatory environment across the EU. They apply to all member states of the European Union and require them to enact laws and/or regulations to comply with the directives. The directives are legally binding and set forth minimum standards and obligations for financial institutions and other entities within the member states. The directives do not set forth non- binding best practices, but rather harmonize the AML/CFT rules and procedures across the EU. The directives do not have extraterritorial impact and do not apply to states that have diplomatic relations with member states, unless they are part of the European Economic Area (EEA) or have equivalent AML/CFT regimes.

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