EU madops new rules to fight money laundering

Associated Press, Brussels, Belgium

European Union governments Monday adopted reinforced rules to battle money laundering, seen as a key tool to fight the financing of terrorism after the Sept. 11 attacks.

The legislation is expected to enter into force in 18 months and then must be implemented by all 15 EU member states.

"Today's text widens the scope of the current money laundering directive," said EU Internal Markets Commission Frits Bolkestein in a statement.

Despite a call in September by EU finance ministers to reach a deal quickly, the legislation was held up because of EU Parliament objections on lawyer-client confidentiality.

Current EU rules only oblige bankers to report suspicions of money laundering in cases involving drug trafficking.

The new legislation extends the rules to other professions, including lawyers and accountants, and covers "all serious criminal activities."

However, to avoid undermining lawyer-client confidentiality, the directive exempts lawyers from reporting information they receive from clients during criminal proceedings.

The EU Parliament approved the legislation earlier this month after a compromise was reached with EU governments.