Andorra’s Efforts to Combat Money Laundering Under Scrutiny

Andorra, a small principality nestled in the Pyrenees mountains between France and Spain, has come under pressure to strengthen its anti-money laundering (AML) measures. A recent assessment by international experts has highlighted several weaknesses in Andorra’s AML regime.

Weaknesses in Andorra’s AML Regime

• Lack of multilateral treaties on international cooperation
• AML law of May 1995 only applies to banks and does not cover other institutions that could facilitate money laundering operations
• Law lacks specific powers for the Andorran National Finance Institute (INAF) to supervise institutions subject to diligence obligations

Concerns Over Numbered Accounts

• Experts believe numbered accounts in Andorra should be eliminated in line with international standards

Recommendations for Improvement

• Adopt a new law creating a Financial Intelligence Unit
• Extend diligence obligations beyond the banking sector
• Reformulate the definition of money laundering
• Require professionals such as trustees, lawyers, and accountants to identify the true beneficiary and verify the origin of funds
• Ratify the Vienna and Strasbourg Conventions on mutual legal assistance in criminal matters

Benefits of Implementation

• Rapid adoption and implementation of a new AML law will develop an efficient anti-money laundering system in Andorra
• Planned ratification of the two conventions would significantly improve Andorra’s capacity to assist foreign countries and execute freezing, seizure, and confiscation decisions

Commitment to Combating Money Laundering

Andorra has committed to fighting money laundering effectively and honouring its international obligations in this field. By implementing these measures, the principality will demonstrate its determination to combat this serious crime.