Financial Crime World

Title: Liechtenstein’s Commitment to Financial Compliance Regulations: AML/CFT Zero-Tolerance Policy

A Pivotal Player in the Global Fight Against Financial Crime

In the heart of Europe, the micro-state of Liechtenstein continues to uphold a zero-tolerance policy against money laundering and the financing of terrorism (AML/CFT), making it a pivotal player in the global fight against financial crime.

Following European Economic Area (EEA) membership, Liechtenstein has implemented the EU’s 4th and 5th Anti-Money Laundering Directives and Regulation (EU) 2015/847.

Key Responsibility Holders and Their Tasks

FMA Liechtenstein

  • Ensuring adherence to anti-money laundering regulations
  • Evaluating reports from the Suspicious Transaction Reporting (STR) system
  • Conducting on-site investigations
  • Imposing sanctions when breaches occur

Persons Subject to Due Diligence

  • Financial institutions
  • Trust or Company Service Providers (TCSPs)
  • Designated Non-Financial Businesses and Professions (DNFBPs)

Due Diligence Obligations

  • Identification and verification of clients and beneficial owners
  • Clarification of source of funds and source of wealth
  • Ongoing transaction monitoring
  • Reporting of any suspicious activities

Financial Intelligence Unit (FIU)

  • Receiving and analyzing reports of suspicious transactions and activities
  • Collaborating with the Office of the Public Prosecutor
  • Maintaining a comprehensive overview of ongoing money laundering threats

Prosecution Authorities

  • Launching investigations based on the FIU’s findings
  • Filing charges and coordinating with the court
  • Overseeing reporting obligations outlined in the SPG

Office of Justice

  • Maintaining the confidential register of beneficial owners of Liechtenstein corporations, foundations, and trusts

Compliance with International Standards

  • Active participant in global AML/CFT efforts since the late-90s
  • Member of Moneyval, an FATF-style regional organization
  • Rated ‘compliant’ or ’largely compliant’ with 37 of the FATF’s 40 recommendations
    • Excelled in five ‘immediate outcomes’ evaluated
    • No significant gaps identified

European Cooperation

Collaboration with EU/EEA counterparts

  • Developing regulatory technical standards, guidelines, and exchanging information on current trends in member states
  • Represented by the Financial Market Authority (FMA)

European Banking Authority (EBA) and AML CFT Standing Committee (AMLSC)

  • Centralization of AML/CFT responsibilities at the EU/EEA level
  • Collaborative efforts to combat money laundering and terrorism financing

Conclusion

Liechtenstein’s commitment to financial compliance regulations, specifically its zero-tolerance policy against money laundering and the financing of terrorism, makes it a valuable player in the global fight against financial crime. Implementation of EU directives, strict due diligence obligations, collaboration with European counterparts, and high ratings from international organizations demonstrate Liechtenstein’s commitment and success in the fight against AML/CFT.