Financial Crime World

Luxembourg Takes a Risk-Based Approach to Financial Crime

The Commission de Surveillance du Secteur Financier (CSSF) is proactively combating financial crime in Luxembourg by adopting a risk-based approach to anti-money laundering and counter-terrorism financing (AML/CTF).

Focus on Higher-Risk Customers and Products

The CSSF’s risk-based approach focuses on allocating resources and means to customers and products that pose higher risks. This involves:

  • Identifying potential threats from organized crime groups involved in money laundering or terrorist financing activities
  • Mitigating these risks through targeted measures

The authority works closely with the Financial Intelligence Unit (FIU) to exchange information and share expertise.

Requirements for Financial Institutions

Financial institutions under the CSSF’s supervision are required to:

  • Cooperate fully with the CSSF and FIU
  • Implement a risk-based approach to AML/CTF compliance, including:
    • Conducting customer due diligence
    • Maintaining adequate internal management systems
    • Reporting suspicious transactions

Powers of the CSSF

The CSSF has robust powers to carry out its duties, including:

  • Access to documents and information gathering
  • On-site inspections
  • The power of injunction

If institutions fail to comply with AML/CTF regulations, the CSSF can impose administrative sanctions, such as:

  • Warnings
  • Reprimands
  • Fines
  • Occupational prohibitions

Obligations for Financial Professionals

Financial professionals are required to comply with specific obligations under Regulation (EU) 2015/847 on information accompanying transfers of funds. This includes:

  • Responding promptly to requests for information from AML/CTF authorities

Commitment to Combating Financial Crime

The CSSF is committed to maintaining a robust and effective framework for combating financial crime in Luxembourg. For further information, please refer to the authority’s FAQs on AML/CFT and applicable regulations.

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