A new European Union body designed to clamp down on money laundering and schemes to circumvent sanctions will be based in the German city of Frankfurt, the Belgian presidency of the EU announced on Thursday.

Nine cities — Brussels, Dublin, Frankfurt, Madrid, Paris, Riga, Rome, Vienna, and Vilnius — were in the running to be the host city for the bloc's Anti-Money Laundering Authority (AMLA).

The European Parliament and the European Council agreed the agency should be based in the German financial capital, which is also home to the European Central Bank.

German Chancellor Olaf Scholz said the decision would further strengthen Frankfurt as Europe's financial center.

AMLA to fight illicit financial activities in the EU

The agency, tasked with combatting money laundering and terrorist financing, will have over 400 staff and start operations in mid-2025.

Lacking any pan-EU authority to control dirty money, the European Commission first mooted AMLA in 2021 to help coordinate the fight against illegal cross-border financial activities. 

AMLA will have supervisory powers and the power to impose financial penalties in serious or repeated breaches.

EU lawmakers involved

Thursday's vote was the first time EU lawmakers were involved in selecting a location for an EU agency.

German Finance Minister Christian Lindner pushed hard for Frankfurt to host the agency and his department on Thursday said it was, "delighted that our bid was successful." 

"Fighting financial crime is a top priority for Germany and the EU and will be implemented by AMLA in Frankfurt," the Finance Ministry wrote in a post on X, formerly Twitter.

Not everyone was happy with the decision; Irish Member of the European Parliament Clare Daly took to X to say, "The big boys made sure that one of their own took the prize yet again ... so much for geographic balance in the EU!"

lo/nm (dpa, AFP, Reuters)