Italy, Belgium, France, the Netherlands and Spain are pressing the European Commission in order to obtain an intervention on the European Central Bank to put 500 euro banknotes out of the market, which are a precious tool for tax evasion and money laundering. The request is contained in a Position Paper sent to the Commission during the summer, in conjunction with the presentation of the package of regulatory measures to combat money laundering, including the establishment of an anti-money laundering authority for which the ABI and various politicians had asked to move the headquarters to Milan .
The proposal: limit cash circulation to 5 thousand euros
In the document, the five countries also underline the need to put a European limit on the circulation of cash within 5 thousand euros compared to the 10 thousand euros proposed by the Commission as part of the anti-money laundering package presented at the end of July. The question – and at the same time the pressure of the countries – is becoming topical again because in these days the work of the Council and Parliament on the proposals for self-application regulation and directive aimed at trialogue has started.
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In particular, the Council has begun to evaluate the various positions on the cash ceiling to be imposed at EU level, leaving individual countries the autonomy to introduce more restrictive thresholds (in Italy the ceiling is 2 thousand euros). But the debate also serves on the powers to be attributed to the Anti-Money Laundering Authority: that is, whether to set up an Authority that carries out a simple monitoring or an entity with supervisory powers such as those that the ECB possesses, a perspective the latter advocated by Italy.
500 euro banknotes money laundering tool
Returning to the 500 euro banknotes, the Position Paper recalls how “studies show” that these coins are “an important factor in facilitating money laundering. In 2016, the Commission highlighted the role played by 500 euro banknotes in financing terrorist activities in its action plan to strengthen the fight against terrorist financing. In this plan, the Commission stated that high-denomination banknotes are in great demand among criminal elements engaging in the physical transport of cash due to their high value and low volume. ‘
The document recalls how in 2016 the ECB “took into account the concerns relating to the 500 euro banknote and decided to stop the production and issuance of 500 euro banknotes”. However, those banknotes continue to be legal tender, retain their value and can be exchanged at national central banks for an unlimited period of time. “The latest statistics at the end of February 2021 show that 400 million banknotes are still in circulation, for a total value of 200 billion euros”.