Financial Crime World

Andorra Tightens the Noose on Financial Crime: A New Era of Anti-Money Laundering Compliance

Andorra, the European microstate between France and Spain, is strengthening its anti-money laundering (AML) and counter-terrorism financing (CTF) protocols to combat illicit activities. Known for tax havens and banking secrecy, this principality is responding to international pressure to comply with standards and reduce risk.

New Legislation for Enhanced AML/CTF Measures

The Andorran government has passed new legislation to modify its:

  1. Financial and Fiscal Criminal Code
  2. AML and CTF procedures

Changes include:

  • Customer due diligence requirements
  • Enhanced record-keeping and reporting
  • Bolstered role of Financial Intelligence Unit (FIU)

Stricter Customer Due Diligence

Financial institutions and designated non-financial businesses and professions (DNFBPs) in Andorra must now:

  • Verify client identity
  • Assess business relationship risks

This is in response to the EU’s fifth AML directive.

Beefed-up Record-keeping and Reporting

Financial institutions and DNFBPs need to maintain records of:

  • Transactions
  • Clients
  • Beneficial ownership structures

for at least five years.

FIU’s Role Surging

The FIU, Andorra’s financial intelligence agency, plays a crucial role in:

  • Receiving, analyzing, and disseminating suspicious transaction reports (STRs)
  • Collaborating with international partners

Andorran institutions will also report potential money laundering and terrorist financing to the FIU.

Increased Cooperation Between Jurisdictions

Andorran authorities are bolstering international partnerships to:

  • Share intelligence and knowledge
  • Facilitate mutual legal assistance

Global Financial System Integrity

New measures come as a response to growing international pressure for financial regulations to:

  • Maintain the integrity of the global financial system
  • Minimize illicit activities

Andorra’s recent developments mark a turning point towards greater transparency and stricter regulations, ensuring a safer and more stable financial environment for businesses and investors.