Financial Crime World

Moneyval Report: Liechtenstein’s Progress and Challenges in Combating Money Laundering and Terrorism Financing

On June 29, 2022, the European anti-money laundering body, Moneyval, published a new assessment report on Liechtenstein, evaluating the country’s ongoing efforts to prevent and combat money laundering (ML) and terrorism financing (TF).

Progress and Commendations

  1. Understanding ML/TF risks
  2. Setting national policies
  3. Financial intelligence
  4. Confiscating proceeds of crime

Moneyval commended Liechtenstein for these advancements [].

Areas for Improvement

Despite these accomplishments, Liechtenstein faces challenges that require further attention.

Strengthening Supervision

  1. Ensure supervision of financial institutions
  2. Increase resources for supervisory authorities

Enhancing Private Sector Adherence

  1. Encourage private entities to implement ML/TF preventive measures
  2. Increase awareness and compliance training

Improving Transparency of Beneficial Ownership

  1. Enhance the effectiveness of registration requirements
  2. Enable access to accurate and up-to-date beneficial ownership information

Investigating ML and Terror Financing Cases

  1. Enhance the capabilities and resources of law enforcement agencies
  2. Increase focus on investigating complex ML and TF cases

Addressing Risks in the Financial Sector

  1. Evaluate potential risks from trusts and company service providers

Concerns and Recommendations

Moneyval expressed concern over the potential use of trusts and company service providers for ML, particularly in the context of foreign tax crimes.

To address this, the report suggests strategic analysis reports on the following subjects:

  1. ML involving foreign tax crimes
  2. The adequacy of SAR/STR reporting on these crimes

The Role of the FIU

The Financial Intelligence Unit (FIU) plays a crucial role in financial investigations. While Suspicious Activity Reports (SARs)/Suspicious Transaction Reports (STRs) are mostly commensurate with the prevalence of revenue-generating crimes in Liechtenstein, there is a need for increased reporting on high-risk predicate offenses like tax offenses.

Conclusion

Liechtenstein’s progress in combating ML and TF is significant, but there is still work to be done to address lingering challenges, specifically related to transparency, supervision, and the private sector’s adherence to ML/TF preventive measures.