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Andorra’s Financial Crime Prevention Tips: Avoid Severe Consequences
The Principality of Andorra has a significant economy, with financial activity generating a substantial portion of its revenue. As such, it is heavily regulated by the Andorran Financial Authority, which prohibits the practice of financial activity without prior authorization.
What Constitutes Financial Activity?
Many people associate financial activity with banking and wealth management. However, it encompasses a broader range of operations, including:
- Collecting payments in installments
- Lending money at interest
Even seemingly innocuous activities can be considered financial activities that require authorization.
Consequences of Non-Compliance
Failure to comply with regulations can result in severe consequences, including:
- Fines of up to 1 million euros for individuals
- Fines of up to 5% of the net business volume or twice the profits obtained from the operation for companies
- Suspension of social rights
- Prison sentences of up to four years in cases deemed criminal
- Company dissolution
Seek Professional Advice
It is essential for individuals and legal entities considering granting loans or credits on a regular or sporadic basis to consult with a legal professional to avoid undesirable situations. At Augé Legal & Fiscal, experts are well-versed in Andorra’s financial system regulations and advise businesses and individuals on the limits and powers they can exercise while complying with industry regulations.
Navigating Regulatory Complexity
With guidance from our experts, it is possible to navigate the complex regulatory landscape and ensure compliance without risking severe consequences. By consulting with us, you can rest assured that your financial activities are in line with Andorran law and regulations.