Financial Crime World

Title: Liechtenstein’s Steadfast Battle Against Money Laundering: MONEYVAL Report Highlights Progress

Liechtenstein’s Commitment to Financial Transparency

The Principality of Liechtenstein, known for its financial transparency, is leading the way in Europe by rigidly enforcing Anti-Money Laundering (AML) and Countering the Financing of Terrorism (CFT) regulations. In the latest evaluation report by the Council of Europe’s MONEYVAL, Liechtenstein was praised for its robust AML/CFT measures.

Adherence to EU Anti-Money Laundering Directives and Regulation

As a member of the European Economic Area (EEA), Liechtenstein has adopted the 4th and 5th EU Anti-Money Laundering Directives and Regulation (EU) 2015/847. Key legislation within Liechtenstein includes:

  • The Due Diligence Act (SPG) and its Ordinance (SPV)
  • Act on the Register of Beneficial Owners of Legal Entities (VwbPG)

Responsibilities in Liechtenstein’s AML/CFT Framework

Responsibility Matrix

  • FMA Liechtenstein: Monitors and imposes measures/sanctions
  • Persons subject to due diligence: Financial institutions, TT service providers, and Designated Non-Financial Businesses and Professions (DNFBPs)
  • Financial Intelligence Unit (FIU): Receives and analyses reports of suspicion
  • Prosecution authorities: Initiate investigations and file charges
  • Office of Justice: Maintains the Register of Beneficial Owners

Duty Bearers

Financial Market Authority (FMA)

  • Ensures institutions and professionals adhere to AML rules
  • Uses SPG reporting system to assess compliance
  • Conducts on-site inspections
  • Follows up on suspicious transactions

Persons subject to due diligence

  • Financial institutions
  • Transaction service providers
  • Designated Non-Financial Businesses and Professions (DNFBPs)
  • Identify and verify clients, beneficial owners, and sources of funds/wealth
  • Ongoing transaction monitoring
  • Suspend transactions upon suspicion

Financial Intelligence Unit (FIU)

  • Receives and evaluates reports of suspicious transactions
  • Reports potential criminal activity to the Office of the Public Prosecutor

Prosecution authorities

  • Initiate investigations and file charges
  • Enforce AML/CFT and late/non-filed reports of suspicion laws

Office of Justice

  • Maintains the Register of Beneficial Owners of Legal Entities

Compliance with International Standards

Liechtenstein’s steadfast stance on AML/CFT measures dates back to the late 1990s. It is a proactive member of the Financial Action Task Force (FATF) and MONEYVAL. The country’s consistent effort in developing and enhancing its regulatory framework was acknowledged in MONEYVAL’s 2021/2022 report.

Key Findings from MONEYVAL Report

Liechtenstein was found to be “compliant” or “largely compliant” with 37 of the total 40 FATF recommendations. In the “immediate outcomes” assessment, Liechtenstein ranked above average in five of the 11 categories examined. No significant gaps were identified in the country’s AML/CFT system, aside from minor improvements.

Cooperation

At the European level, the European Banking Authority (EBA) oversees AML/CFT responsibilities related to the financial market. The AML CFT Standing Committee (AMLSC) formulates regulatory technical standards (RTSs) and guidelines in conformity with the 4th and 5th EU Anti-Money Laundering Directives and Regulation (EU) 2015/847. The AMLSC also holds regular meetings to synchronize activities among national supervisory authorities and exchange information on ongoing AML/CFT challenges in member states. The FMA represents Liechtenstein as a non-voting member in the AMLSC.