Financial Crime World

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Liechtenstein Takes Significant Steps to Combat Money Laundering, But Implementation Remains a Challenge

August 14, 2018

The Principality of Liechtenstein has made notable progress in strengthening its anti-money laundering and combating the financing of terrorism (AML/CFT) framework, according to a new technical note from the International Monetary Fund. Despite this, the report highlights uneven implementation and areas where improvement is still needed.

Progress and Challenges

According to the report, Liechtenstein has taken significant steps to align its legal framework with international standards set by the Financial Action Task Force (FATF). The country has also consolidated an overall robust institutional framework for combating money laundering and terrorist financing, with domestic cooperation remaining strong.

However, it’s noted that the country’s AML/CFT implementation is not always optimal, with some areas requiring improvement. “Liechtenstein has made significant progress in strengthening its AML/CFT framework,” said a senior IMF official. “However, we urge the authorities to continue their efforts to ensure effective implementation and address areas of concern.”

Key Findings

  • Alignment with International Standards: Liechtenstein has aligned its legal framework with international standards set by FATF.
  • Robust Institutional Framework: The country has consolidated a robust institutional framework for combating money laundering and terrorist financing.
  • Strong Domestic Cooperation: Domestic cooperation remains strong, with key stakeholders enjoying trust from the financial and non-financial sectors.
  • Uneven Implementation: Implementation is uneven, with some areas requiring improvement.
  • Effective Asset Recovery: In rem regime confiscation of criminal proceeds has proven effective in recovering illicit assets.

Recommendations

To address the challenges identified in the report, the IMF recommends:

  • Continuing to Strengthen AML/CFT Implementation: Liechtenstein should continue to strengthen its implementation of AML/CFT measures.
  • Addressing Areas of Concern: The authorities should address areas of concern identified in the report.
  • Enhancing Transparency and Cooperation: Enhance transparency and cooperation between financial institutions and law enforcement agencies.