Financial Crime World

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Liechtenstein’s Due Diligence Procedures: A Model for Compliance

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In its ongoing efforts to combat money laundering and terrorist financing, Liechtenstein has implemented robust due diligence procedures for banks operating within its borders. As an EEA member, the country has transposed the 4th and 5th EU Anti-Money Laundering Directives, as well as Regulation (EU) 2015/847 on information accompanying transfers of funds.

Implementing Provisions

The key implementing provisions can be found in:

  • The Law on Professional Due Diligence for the Prevention of Money Laundering, Organised Crime and Financing of Terrorism (Due Diligence Act; SPG)
  • The Ordinance on Professional Due Diligence for the Prevention of Money Laundering, Organised Crime and Financing of Terrorism (Due Diligence Ordinance; SPV)

Due Diligence Obligations

Banks operating in Liechtenstein are subject to a range of due diligence obligations, including:

  • Identification and verification of clients, beneficial owners, and source of funds and wealth
  • Conducting ongoing transaction monitoring
  • Filing reports of suspicion

The Financial Intelligence Unit (FIU) plays a crucial role in receiving and analyzing reports of suspicion from banks and other public authorities. If the FIU suspects that a criminal offense has been committed, it reports to the Office of the Public Prosecutor, which initiates investigations where appropriate.

International Recognition

Liechtenstein’s due diligence procedures have been praised by international organizations, with the country rated “compliant” or “largely compliant” with 37 of the 40 FATF recommendations. The country also performed well in comparison with other jurisdictions evaluated by MONEYVAL, with a strong supervisory approach commensurate to its risks.

European Cooperation

The FMA represents Liechtenstein in the AMLSC, a high-level committee that coordinates and harmonizes the work of national supervisory authorities across the EU/EEA. This cooperation at the European level is essential for ensuring a robust and effective anti-money laundering framework across the region.

Conclusion

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In conclusion, Liechtenstein’s due diligence procedures provide a model for compliance in the fight against money laundering and terrorist financing. The country’s strong supervisory approach, combined with its active participation in international efforts to combat these crimes, make it an exemplary jurisdiction in this regard.