Financial Crime World

Luxembourg’s Financial Crime Definition Takes Center Stage: CSSF Emphasizes Vigilance and Cooperation

The Commission de Surveillance du Secteur Financier (CSSF) has reiterated its commitment to combating financial crime by ensuring that all professionals under its supervision comply with anti-money laundering and countering the financing of terrorism (AML/CTF) regulations.

Risk-Based Strategy

The CSSF’s approach is centered around a risk-based strategy, where it allocates resources and attention to those entities and customers that pose higher risks. This includes identifying individuals or groups linked to organized crime, including those involved in money laundering and terrorist financing activities.

Key Components of the Risk-Based Strategy

  • Identifying high-risk entities and customers
  • Allocating resources accordingly
  • Exchanging information with other authorities
  • Conducting on-site inspections and accessing documents

Close Cooperation with Authorities

To achieve its goal, the CSSF relies on close cooperation with other authorities, such as the Financial Intelligence Unit (FIU), and has the power to exchange information necessary for its duties.

Benefits of Close Cooperation

  • Enhanced information sharing
  • Improved risk assessment
  • Increased effectiveness in combating financial crime

Consequences of Non-Compliance

In cases where professionals fail to comply with AML/CTF regulations, the CSSF may issue warnings, reprimands, administrative fines, or occupational prohibitions. These sanctions can be made public by the regulator and are without prejudice to criminal sanctions that may be imposed by courts.

Types of Sanctions

  • Warnings
  • Reprimands
  • Administrative fines
  • Occupational prohibitions

Obligations Under AML/CTF Regulations

Financial sector professionals are reminded of their obligations under AML/CTF texts, including:

Key Obligations

  • Customer due diligence
  • Internal management requirements
  • Cooperation with authorities
  • Compliance with relevant EU regulations (e.g. Regulation (EU) 2015/847 on information accompanying transfers of funds)

Resources Available

The CSSF has made available a range of resources to help professionals navigate these complex regulations, including FAQs and applicable texts.

Additional Support

  • Expert working groups
  • Committee dedicated to AML/CTF matters
  • Ongoing efforts to stay ahead of emerging threats and maintain the highest standards of transparency and cooperation in the fight against financial crime.

The CSSF’s efforts are part of its broader commitment to ensuring the integrity and stability of Luxembourg’s financial sector.