european central bank....euro (bolja).jpg
Photograph: Photo by Volker Kannacher, used under CC BY-ND

The European Central Bank (ECB) is expected Wednesday to announce plans to withdraw from circulation the 500-euro banknote because of its reputation as the preferred tool for illicit cash transactions.

A decision setting timing and conditions for the measure is likely to be announced in the afternoon, following a meeting of the ECB's governing council.

In February, ECB President Mario Draghi signaled the Frankfurt-based bank's intentions, when he said there was "a pervasive and increasing conviction in the world of public opinion that high denomination banknotes are used for criminal purposes."

Large denomination banknotes make life easier for people who need to move large quantities of money without passing through official channels, such as members of the Mafia, money launderers and terrorists.

Due to these considerations, 500-pound notes were axed in Britain in 2010 and 1,000-dollar notes were abolished in Canada 10 years earlier. In the United States, the highest denomination banknote is worth only 100 dollars.

In a commentary for the La Repubblica newspaper, anti-Mafia magistrate and author Giancarlo De Cataldo wrote that only "drug traffickers and bribers" would mourn the phasing out of 500-euros bills.

"For them, the ECB decision, long in the making, is a major blow, and the disappearance of 500-euro [notes] a real curse," De Cataldo said.

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