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Liechtenstein Takes Strong Stand Against Money Laundering and Terrorism Financing
In a bid to strengthen its position against money laundering and terrorism financing, Liechtenstein has implemented a robust anti-money laundering (AML) and combating the financing of terrorism (CFT) framework. The country’s commitment to AML/CFT is evident in its zero-tolerance policy towards these financial crimes.
Liechtenstein’s AML/CFT Framework
As an EEA member, Liechtenstein has transposed the 4th and 5th EU Anti-Money Laundering Directives as well as Regulation (EU) 2015/847 on information accompanying transfers of funds into its national legislation. The key implementation provisions are found in the:
- Law on Professional Due Diligence for the Prevention of Money Laundering, Organised Crime and Financing of Terrorism (Due Diligence Act; SPG)
- Ordinance on Professional Due Diligence for the Prevention of Money Laundering, Organised Crime and Financing of Terrorism (Due Diligence Ordinance; SPV)
Key Requirements
Financial institutions, trust service providers, and designated non-financial businesses and professions (DNFBPs) in Liechtenstein are required to comply with AML rules when dealing with their clients. These due diligence obligations include:
- Client identification
- Beneficial owner identification
- Risk assessment
- Transaction monitoring
Financial Intelligence Unit
The Financial Intelligence Unit (FIU) is responsible for receiving and analyzing reports of suspicion from persons subject to due diligence and public authorities. The FIU also analyzes general threats of money laundering, predicate offenses of money laundering, and financing of terrorism.
Overwhelmingly Positive Review by MONEYVAL
Liechtenstein has been actively participating in AML/CFT efforts for decades, guided by the international standards of the Financial Action Task Force (FATF). The country’s commitment to AML/CFT was recently recognized by MONEYVAL, an FATF-style regional body based at the Council of Europe in Strasbourg.
In its fifth report on Liechtenstein, published on June 29, 2022, MONEYVAL acknowledged the country’s progress in improving measures to combat money laundering and financing of terrorism. The report highlighted Liechtenstein’s broad and convergent understanding of its money laundering and terrorist financing risks, as well as its strong supervisory approach commensurate to the risks.
Liechtenstein’s Commitment to AML/CFT Sets Higher Standards
Liechtenstein’s commitment to AML/CFT is evident in its robust legislation, regulations, and guidance. The country has been rated “compliant” or “largely compliant” with 37 out of the 40 FATF Recommendations. MONEYVAL also emphasized Liechtenstein’s progress since the fourth round of evaluations, encouraging the country to further intensify its AML/CFT measures.
As a member of the European Union (EU), Liechtenstein is subject to EU/EEA-level AML/CFT responsibilities relating to the financial market. The country represents itself in the AML CFT Standing Committee (AMLSC) as a non-voting member, where it develops regulatory technical standards and guidelines in accordance with the requirements of the 4th and 5th EU Anti-Money Laundering Directives.
Conclusion
In conclusion, Liechtenstein’s commitment to AML/CFT is evident in its robust framework, legislation, and regulations. The country’s zero-tolerance policy towards money laundering and terrorism financing has been recognized by MONEYVAL, an FATF-style regional body based at the Council of Europe in Strasbourg.