Financial Crime World

Here is the rewritten article in Markdown format:

Preventing Financial Fraud in Liechtenstein: A Closer Look at MONEYVAL’s Evaluation Report

A recent evaluation report from MONEYVAL, published on June 29, 2022, has shed light on Liechtenstein’s efforts to prevent and combat financial fraud. The report assessed the country’s progress in preventing money laundering (ML) and terrorism financing (TF), revealing both strengths and weaknesses.

Progress Made

According to the report, Liechtenstein has made significant strides in:

  • Understanding ML/TF risks
  • Setting national AML/CFT policies
  • Using financial intelligence
  • Confiscating proceeds of crime
  • Investigating and prosecuting TF cases
  • Implementing targeted financial sanctions

Areas for Improvement

However, MONEYVAL identified areas where Liechtenstein needs to improve, including:

  • Enhancing supervision
  • Improving application of AML/CFT measures by the private sector
  • Increasing transparency around beneficial ownership of legal persons and legal arrangements
  • Strengthening money laundering investigation and prosecution

Concerns Raised

The report highlighted concerns about:

  • The lack of assessment of ML/TF risks related to tax crimes committed abroad
  • The potential misuse of non-bank assets held by trust and company service providers
  • Some exemptions for investment funds without a country risk assessment backing them up

Financial Intelligence Unit (FIU)

Liechtenstein’s FIU was praised for its role in providing financial information and producing strategic analysis reports. However, the report suggested that further reports on:

  • TF
  • Laundering of proceeds of foreign tax crimes
  • Adequacy of SAR/STR reporting on these crimes could be useful

The country’s legal framework allows for effective investigation and prosecution of all types of ML. However, MONEYVAL noted that investigations involving complex legal structures established in Liechtenstein are lacking, and there is a need for consistent prosecution of all ML-related activities.

Confiscation of Proceeds of Crime

Confiscation of proceeds of crime is a policy objective in Liechtenstein, with a comprehensive legal framework in place. While the authorities’ actions have generally been in line with the country’s risk profile, MONEYVAL called for more dissuasive and proportionate sanctions to be imposed.

Terrorism Financing

The report noted that there has been only one prosecution in this area, but it demonstrated the competent authorities’ skills and knowledge on detecting TF activities. The lack of TF prosecutions is in line with Liechtenstein’s risk profile, according to MONEYVAL.

Non-Profit Organizations (NPOs)

Non-profit organizations operating in Liechtenstein were found to have a good awareness of ML/TF risks, although some NPOs operating as associations were less informed about their obligations under CFT measures. The report also noted that banks and large trust and company service providers have a good understanding of ML/TF risks associated with private banking and wealth management.

Conclusion

Overall, the report concluded that Liechtenstein has made progress in preventing financial fraud, but there is still room for improvement, particularly in areas such as supervision, application of AML/CFT measures by the private sector, and transparency around beneficial ownership. By addressing these weaknesses, Liechtenstein can further strengthen its efforts to prevent and combat ML/TF.