Financial Crime World

AML/CFT Regulations and Practices in Luxembourg

Luxembourg’s Anti-Money Laundering (AML) and Combating the Financing of Terrorism (CFT) regulations are designed to prevent, detect, and report suspicious financial transactions. This comprehensive guide will walk you through the key aspects of AML/CFT practices in Luxembourg.

Reporting Suspicious Activities

  • The AML Law requires professionals to report suspicious transactions or activities to the Financial Intelligence Unit (CRF).
  • Reports must be filed through an online platform called goAML.
  • The CRF is responsible for receiving and analyzing these reports, which may involve exchanging information with foreign FIUs.

Central Authority for Reporting

  • Financial Intelligence Unit (CRF): The national authority responsible for receiving and analyzing suspicious transaction reports.
  • Exceptional Circumstances: Information exchange with foreign FIUs can be refused in exceptional circumstances or if it involves a third country.

Registers for Conducting and Validating AML Information

  • Trade and Companies Register (RCS): Maintained by the State’s Central Register of Commerce, this register provides information about corporates.
  • Beneficial Owner Register (RBE): This register is used to obtain information about beneficial owners. It must be interconnected via the European Central Platform established by Directive (EU) 2017/1132.
  • Register of Fiduciary Contracts and Trusts (RFT): This register contains information on fiducies and express trusts.

Interoperability of Registers

  • The RBE and RFT must be interconnected via the European Central Platform established by Directive (EU) 2017/1132.
  • National authorities can access information from these registers, and supervisory authorities and self-regulatory organizations are required to cooperate with their foreign counterparts.

International Cooperation

  • The CRF may exchange information with a foreign FIU of whatever type.
  • International cooperation is essential in the fight against money laundering and terrorist financing.

Fines for AML Non-Compliance

  • In 2021, the CSSF imposed 16 AML-related fines on financial sector entities, with amounts ranging from EUR 5,000 to EUR 1,320,000.
  • These fines serve as a reminder of the importance of complying with AML/CFT regulations.

Conclusion

The AML/CFT regulations in Luxembourg are designed to prevent and detect suspicious financial transactions. By understanding these regulations and practices, you can ensure compliance and contribute to a safer financial environment. However, please note that this is a general guide and should not be considered as specialist advice. If you have specific circumstances, it’s recommended to seek professional guidance.