DNB identifies opportunities for proportionate AML/CFT application
De Nederlandsche Bank (DNB) conducted a survey among five Dutch banks, finding opportunities for more tailored solutions in applying anti-money laundering and anti-terrorist financing (Wwft) rules. The survey focused on customers with a low risk of money laundering, where current practices are often seen as excessive.
The proportionality challenge
De Nederlandsche Bank (DNB) conducted an exploratory survey in 2025 across five Dutch banks to assess the proportionate application of the Anti-Money Laundering and Anti-Terrorist Financing Act (Wwft).
The survey targeted low-risk customer groups, including charities, homeowners' associations, small SMEs, and politically exposed persons (PEPs), prompted by concerns that some Wwft procedures were perceived as excessive.
Banks acknowledged the importance of proportionality and expressed willingness to align procedures with customer risk profiles.
However, they reported facing significant constraints in practice.
These constraints often lead to measures more burdensome than necessary, creating disproportionate pressure on customers and operational inefficiencies.
DNB highlighted that a risk-based approach requires professional judgment, which can conflict with the principle of proportionality when banks err on the side of caution or pursue excessive information completeness.
Constraints in practice
Several factors contribute to banks' hesitancy in scaling back measures, even for low-risk cases.
Risk aversion often leads to strict compliance with rules, limiting analysts' professional judgment.
Feedback dynamics from oversight functions tend to exert upward pressure on customer risk ratings, as higher-risk classifications are perceived as safer.
Various published risk indicators are sometimes interpreted as automatic triggers for action, leading to additional measures regardless of the broader customer profile.
Furthermore, employee knowledge and subject-matter expertise are crucial, particularly for specific customer groups, as limited insight into day-to-day operations hinders accurate risk assessments and proportionate measures.
Beyond rigid procedures
The DNB survey clearly indicates that more proportionate application of Wwft requirements is achievable.
Strengthening institutional expertise, centralising information access, and encouraging professional judgment are key to moving beyond rigid procedures.
This approach, while accepting some residual risks, allows for tailored solutions and a sharper focus on genuinely high-risk cases.