Financial Crimes Definition Takes Center Stage in Liechtenstein’s Open Market

Liechtenstein has taken a comprehensive strategic approach to combat money laundering and financing of terrorism (ML/FT), mirroring international standards.

International Cooperation and Compliance

As a member of the European Economic Area (EEA) and MONEYVAL, Liechtenstein is committed to implementing EU Anti-Money Laundering (AML)/Countering Financing of Terrorism (CFT) provisions and Financial Action Task Force (FATF) recommendations. This ensures that international requirements are met while also serving the country’s own interests.

Whole-Of-Government Approach

Liechtenstein’s financial market, known for its openness and global orientation, relies on close cooperation between national authorities and financial market participants to prevent ML/FT. This whole-of-government approach ensures that not only are international requirements met but also the country’s own interests are served.

Risk Identification and Assessment

A crucial aspect of Liechtenstein’s strategy is identifying, assessing, and understanding ML/FT risks. Recent years have seen vigorous information and data analysis, culminating in National Risk Assessments (NRAs) that provide substantiated conclusions on the country’s risk exposure.

Global Client Base and Competitive Advantage

The Liechtenstein financial center boasts a global client base, offering a range of financial products and services from a small geographic area. While this competitive advantage poses ML/FT risks, authorities view these risks globally, assessing and mitigating them from a worldwide perspective.

Blockchain Act and Virtual Assets Regulation

In 2020, Liechtenstein became the first country to introduce a comprehensive regulation and supervisory system for virtual assets, known as the Blockchain Act. This move allowed authorities to evaluate data for risk assessments, and they continue to monitor market developments, adapting their approach to emerging risks.

AML/CFT Strategy and Action Plan

The results of these risk assessments have informed the development of an AML/CFT strategy and action plan by the Liechtenstein Government. Key priorities include intensified cooperation, coordination, and information exchange at both national and international levels, including collaboration with US authorities such as FinCEN, OFAC, DOJ, and SEC.

Results

As a result, Liechtenstein’s financial center is well-equipped to address ML/FT risks, ensuring the integrity of its financial system while maintaining its competitive edge in the global market.