Financial Crime World

Financial Crimes and Terrorism Financing in Liechtenstein Under Scrutiny

A recent report by MONEYVAL, the Council of Europe’s anti-money laundering body, has shed light on Liechtenstein’s efforts to combat money laundering and financing of terrorism. While acknowledging significant progress made by the country, the report also identified several areas that require further strengthening.

Progress Made

According to the report, Liechtenstein has demonstrated a substantial level of effectiveness in:

  • Understanding money laundering and terrorist financing risks
  • Setting national anti-money laundering and counter-terrorism policies
  • Coordinating efforts between authorities
  • Confiscating proceeds of crime and investigating and prosecuting terrorist financing cases

Areas for Improvement

However, the report highlighted several areas that need improvement, including:

  • Enhancing supervision over financial institutions
  • Increasing the application of anti-money laundering and counter-terrorism preventative measures by the private sector
  • Improving transparency on beneficial ownership of legal persons and legal arrangements
  • Strengthening money laundering investigations and prosecutions

Cooperation with Neighboring Countries

Liechtenstein’s cooperation with neighboring countries, including Switzerland and Austria, was praised for its efforts to combat terrorism and terrorist financing. The report found that competent authorities in Liechtenstein are well-equipped to detect, collect, move, and use funds for terrorist financing purposes.

Private Sector Understanding

The private sector in Liechtenstein has shown a good understanding of money laundering and terrorist financing risks, particularly among banks and large trust and company service providers. However, supervision over high-risk entities was found to be insufficient.

Recommendations for Improvement

The report also highlighted the need for:

  • Improved monitoring of beneficial ownership information on legal persons and legal arrangements
  • Provision of timely and constructive assistance in international cooperation requests

Conclusion

As a result of the positive report, Liechtenstein will become one of only five member-jurisdictions subject to MONEYVAL’s regular follow-up reporting process. The country is expected to continue strengthening its measures to combat financial crimes and terrorism financing.