Liechtenstein’s Banking Industry Complies with Stringent Anti-Money Laundering Regulations
As a member of the European Economic Area (EEA), Liechtenstein has prioritized anti-money laundering and combating the financing of terrorism (AML/CFT) measures, adopting a zero-tolerance policy towards these financial crimes.
Effective Compliance through Regulations and Laws
To ensure effective compliance, Liechtenstein has implemented various regulations and laws, primarily governed by:
- Law on Professional Due Diligence for the Prevention of Money Laundering, Organised Crime and Financing of Terrorism (Due Diligence Act; SPG)
- Ordinance on Professional Due Diligence for the Prevention of Money Laundering, Organised Crime and Financing of Terrorism (Due Diligence Ordinance; SPV)
These laws require financial institutions, trust service providers, and DNFBPs to conduct thorough due diligence when dealing with clients.
Key Due Diligence Obligations
The most critical due diligence obligations include:
- Identifying and verifying clients and beneficial owners
- Clarifying the source of funds and wealth
- Ongoing transaction monitoring
- Filing reports of suspicious activities
The Financial Intelligence Unit (FIU) is responsible for analyzing these reports and referring cases to the Office of the Public Prosecutor if necessary.
Register of Beneficial Owners
The Office of Justice maintains a register of beneficial owners, established to comply with EU Anti-Money Laundering Directives governing registers of beneficial owners.
International Cooperation and Oversight
Liechtenstein has actively participated in international AML/CFT efforts, guided by:
- Financial Action Task Force (FATF)
- MONEYVAL, a FATF-style regional body
In 2021/2022, MONEYVAL reviewed Liechtenstein’s implementation of the FATF Recommendations, praising the country’s broad understanding of its money laundering and terrorist financing risks.
Exceptional Performance
Liechtenstein performed exceptionally well in comparison to other evaluated countries, earning it a spot in the regular MONEYVAL follow-up process instead of the enhanced process. The country was rated “compliant” or “largely compliant” with 37 out of 40 FATF Recommendations and scored above average in five immediate outcomes assessed.
EU/EEA Participation
Liechtenstein participates in the AML/CFT Standing Committee (AMLSC) at the EU/EEA level, which develops regulatory technical standards and guidelines to harmonize national supervisory authorities’ work. The FMA represents Liechtenstein as a non-voting member in the AMLSC.
Conclusion
Overall, Liechtenstein’s banking industry has demonstrated its commitment to anti-money laundering regulations, ensuring a safe and secure financial environment for both domestic and international transactions.