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Liechtenstein Takes Steps to Improve Anti-Money Laundering Measures

The Council of Europe’s anti-money laundering body, MONEYVAL, has published a report highlighting Liechtenstein’s progress in strengthening its measures to combat money laundering and financing of terrorism. However, the report also identifies areas where further improvements are needed.

Key Findings of the Report

• Effectiveness in Understanding Money Laundering Risks: Liechtenstein has demonstrated a substantial level of effectiveness in understanding money laundering (ML) and terrorism financing (TF) risks.
• National AML/CTF Policies and Coordination: The country has set national anti-money laundering (AML)/counter-terrorism financing (CTF) policies and coordinated efforts to combat ML/TF.
• Confiscation of Crime Proceeds and TF Cases: Liechtenstein has shown success in confiscating the proceeds of crime and investigating and prosecuting TF cases.

Areas for Improvement

• Supervision over High-Risk Entities: Liechtenstein needs to enhance its supervision over entities assessed as high or medium-high risk.
• Application of AML/CTF Preventative Measures: The country should improve the application of AML/CTF preventative measures by the private sector.
• Beneficial Ownership Transparency: Liechtenstein should increase transparency of beneficial ownership of legal persons and legal arrangements.

Cooperation with Neighboring Countries

• Switzerland and Austria Cooperation: MONEYVAL praised Liechtenstein’s cooperation with neighboring countries, Switzerland and Austria, in combating TF.
• Competent Authorities Skills and Knowledge: The report notes that Liechtenstein’s competent authorities are equipped with the skills and knowledge to detect collection, movement, and use of funds for TF purposes.

Private Sector Understanding

• Good Understanding of ML/TF Risks: In the private sector, understanding of ML/TF risks is generally good, particularly among banks and large trust and company service providers.
• Supervision Improvement Needed: However, supervision over these entities needs improvement.

Follow-up Reporting Process

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