AML in 2025: Expert Advice on BaFin’s Rules, AI, and What’s Next for Fund Managers
Author:
- BaFin’s Eye on AML: What It Means for Private Equity
- Tightening the Rules on Investor Verification
- Onboarding: Where Mistakes Often Happen
- What Auditors Look for: The Spotlight on Outsourcing
- Strategies to Prepare for AML Challenges
- The AML Check Timeline & Tech Assistance
- AML in 2025: What Fund Managers Should Prepare For
If you’re working in finance in Germany, you’ll definitely know all about BaFin or Bundesanstalt für Finanzdienstleistungsaufsicht.
BaFin is Germany’s Federal Financial Supervisory Authority. They’re the ones keeping the financial system in check.
Whether it’s banks, insurance companies, or investment firms, BaFin makes sure everyone’s playing by the rules to keep the system running smoothly and fairly.
One area BaFin oversees is anti-money laundering (AML). And lately, they’ve been reminding stakeholders of the expectations.
Earlier this year, Carsten Sperl, BaFin's specialist in money laundering prevention, highlighted the regulator's intensified focus on insurance companies' anti-money laundering measures.
While speaking specifically about the insurance industry, he suggested that AML is a real topic for concern.
“One of the areas we are focussing on right now is foreign insurance undertakings with branches in Germany,” he explained.
“They are not required to file any reports with us regarding their measures for the prevention of money laundering and terrorist financing. They are mainly supervised by the supervisory authorities in their respective home countries.”
This followed on from a 2023 BaFin published article emphasizing the importance of anti-money laundering compliance for registered asset management companies in Germany.
The article highlighted that, since 2021, these companies are required to undergo annual financial statement audits, which include AML assessments.
However, many have not yet adequately adapted their AML processes.
To make sense of how BaFin influences asset management and figure out how to stay ahead of the curve, we chatted with YPOG’s experts Stefanie Nagel, Sylwia Luszczek and Jannik Zerbst.
They’ve got some great insights into BaFin’s priorities, the biggest AML challenges fund managers face, and some practical tips for navigating what can often feel like a compliance quagmire.
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BaFin’s Eye on AML: What It Means for Private Equity
In private equity, compliance with anti-money laundering regulations is a well-known responsibility.
But as Germany’s financial regulator, BaFin, clarifies its expectations, the question arises: is BaFin becoming more stringent, or is the industry simply hearing more reminders about its obligations?
Frequently Asked Questions
What is BaFin, and what role does it play in financial regulation?
BaFin (Bundesanstalt für Finanzdienstleistungsaufsicht) is Germany’s Federal Financial Supervisory Authority. It regulates and supervises banks, insurance companies, and investment firms to ensure compliance with laws, including anti-money laundering (AML) regulations.
What common mistakes do fund managers make in AML compliance?
Some fund managers often misinterpret due diligence requirements or fail to maintain accurate ongoing monitoring and updates of investor records, leading to compliance risks.
How can technology and platforms like Vestlane help with AML compliance?
Platforms like Vestlane streamline AML processes through automation, enhanced due diligence, and centralized data management.
They reduce onboarding delays and improve compliance by leveraging tools like global name screening and adverse media checks.
What should fund managers prioritize to prepare for upcoming AML challenges?
Fund managers should:
- Update their compliance policies and procedures.
- Conduct regular reviews of outsourcing contracts and external providers.
- Invest in digital platforms and automation tools.
- Stay informed about changes like the EU Anti-Money Laundering Directive.
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