Financial Watchdog Reveals Repeated Violations by Financial Institutions
Liechtenstein Financial Market Authority Discloses Anti-Money Laundering Failures
In a rare move, the Liechtenstein Financial Market Authority (FMA) has released its annual report, revealing that financial institutions and designated businesses have repeatedly violated anti-money laundering regulations. The violations include failure to report suspicious transactions, providing false information to authorities, and other breaches.
Failure to Comply with Regulations
According to the FMA’s report, penalty decisions made by criminal courts are only publicly disclosed if deemed relevant by the courts. However, in some cases, financial institutions have appealed these decisions, leading to a lack of transparency around the extent of the violations.
Measures Implemented by FMA
The FMA has implemented various measures to prevent and detect money laundering, including:
- Due diligence requirements for certain businesses
- Reporting suspicious transactions
- Maintaining accurate records
- Freezing assets in case of suspected terrorist financing
Despite these efforts, the FMA has found that some financial institutions have failed to comply with anti-money laundering regulations.
Consequences of Non-Compliance
The maximum penalties for non-compliance can be severe, including:
- Imprisonment
- Fines up to CHF 360,000
- Suspension or withdrawal of licenses
In cases of repeated or systematic violations, fines can reach as high as CHF 5 million or 10% of annual turnover.
Additional Sanctions
The FMA may impose additional sanctions, including:
- Prohibiting new business relationships
- Requesting disciplinary measures from authorities
- Publicly disclosing decisions against financial institutions
Importance of Effective Anti-Money Laundering Measures
The FMA’s report highlights the importance of effective anti-money laundering measures and the need for continued vigilance in detecting and preventing financial crimes. The authority emphasizes the need for financial institutions to take their obligations seriously and comply with regulations to prevent money laundering and terrorist financing.