Banca d'Italia, Italy's central banking institution, has issued a directive requiring all payment service providers and crypto asset service providers to strengthen screening procedures for financial transactions. The communication, issued on Wednesday, responds to concerns about digital assets being used to circumvent European Union sanctions.
The central bank stressed that institutions must conduct compliance checks on customers at the start of relationships and whenever the EU Council determines it, as well as during every transaction. These checks must verify both the originator and beneficiary names against designated individuals and companies lists, following Travel Rule procedures.
A key emphasis of the directive is the elimination of minimum amount thresholds for screening. Banca d'Italia explicitly stated that "the application of minimum amount thresholds for subjecting transfers to checks is not foreseen" and called on intermediaries, including crypto asset service providers, to ensure their systems do not include such thresholds. This measure targets structuring—the practice of dividing financial amounts to avoid detection by automated systems, commonly used by actors facing sanctions.
The bank acknowledged that screening procedures must balance the need to limit false positives while ensuring identification of designated subjects. However, it prioritized compliance over processing speed, accepting potential delays in transfers to strengthen sanctions enforcement, particularly targeting Russian actors under recent EU sanctions rounds.
