Financial Crime World

Monaco’s Financial Crimes: MONEYVAL’s Fifth Round Evaluation Report Uncovers Moderate Effectiveness

Monaco’s financial crimes have been a point of concern for the international community. The MONEYVAL evaluation team assessed Monaco’s measures against money laundering (ML) and terrorism financing (TF) in a fifth-round assessment report published on 23 January 2023.

Assessment Results

According to the report, Monaco exhibits a moderate level of effectiveness in preventive measures against ML and TF. However, improvements are necessary to address several key areas.

Areas Requiring Improvement

  1. ML/TF risk understanding
  2. International cooperation
  3. Application of AML/CFT preventive measures in the private sector
  4. Use of financial intelligence
  5. Implementation of UN targeted financial sanctions on TF and proliferation financing

Challenges with the Monegasque Financial Intelligence Unit (SICCFIN)

  • Lacks sufficient human and technical resources
  • Receives most suspicious transaction reports (STRs) from banks
  • Limited contributions from other sectors

Unaddressed Risks

  1. ML/TF risks in sectors such as casinos, company services providers, trusts, virtual assets, organized crime, and external threats
  2. Defensive reporting and excessively long transmission times from the banking sector
  3. Poor AML/CFT risk understanding and compliance culture in DNFBPs (Designated Non-Financial Business and Professions), such as casinos and jewellers

Despite some success in ML investigations, prosecutions, and convictions, the report highlights a need to:

  1. Identify and prioritize ML cases
  2. Seize, confiscate, and recover proceeds of ML and predicate offenses
  3. Enhance supervisory system and address deficiencies
  4. Encourage more ML prosecutions of third parties
  5. Implement proportionate but stronger sanctions

The report emphasizes the importance of enhancing efforts to identify and prioritize ML cases in Monaco and strengthening supervisory systems and international cooperation.

Private Sector Responsibilities

To address the shortcomings, the private sector must improve their AML/CFT risk understanding and culture.