Liechtenstein Takes Steps to Combat Financial Crime, but Further Improvements Needed

The Council of Europe’s anti-money laundering body, MONEYVAL, has published a report on Liechtenstein’s efforts to combat money laundering and financing of terrorism. While the country has made significant progress in understanding its risks and implementing measures to prevent financial crime, further improvements are necessary to ensure full compliance with international standards.

Key Findings

• Effective Financial Intelligence: Liechtenstein has demonstrated a substantial level of effectiveness in areas such as financial intelligence, confiscation of proceeds of crime, and international cooperation.
• Need for Improved Supervision: The country’s authorities need to strengthen supervision over entities that present a high or medium-high risk, improve the application of anti-money laundering and combating the financing of terrorism (AML/CFT) preventative measures by the private sector, and enhance transparency of beneficial ownership.
• Comprehensive Understanding of Risks: While Liechtenstein has made significant progress in understanding its core money laundering and terrorist financing risks, a more comprehensive understanding is needed in certain areas.

Cooperation with Neighboring Countries

MONEYVAL praises Liechtenstein for its close cooperation with neighboring countries Switzerland and Austria in combating terrorism and terrorist financing. The report concludes that the country’s competent authorities are equipped with the necessary skills and knowledge to detect, collect, move, and use funds for terrorist financing purposes.

Private Sector Efforts

The private sector in Liechtenstein has shown a good understanding of money laundering and terrorist financing risks, particularly in areas related to private banking and wealth management. However, supervision over entities that present a high or medium-high risk is still inadequate.

Beneficial Ownership Information

Beneficial ownership information on legal persons and legal arrangements is available in Liechtenstein, but the completeness and plausibility of this information has not yet been monitored by the Office of Justice.

International Cooperation

While there are some procedural constraints, Liechtenstein provides timely and constructive assistance across the range of requests for international cooperation.

Follow-Up Reporting Process

Liechtenstein will be subject to MONEYVAL’s regular follow-up reporting process as a result of the positive report, becoming one of only five member-jurisdictions with this outcome so far.