Monaco Race Against Time: Combating Financial Crime and Corruption Ahead of International Scrutiny
Monaco Under International Scrutiny: Enhancing AML Defenses
In the glamorous Mediterranean principality of Monaco, authorities are working diligently to enhance its Anti-Money Laundering (AML) system in response to critical feedback from Moneyval, a Council of Europe body.
Uptick in Company Directors Visiting Monaco
For months, Monaco’s Business Development Agency has seen an increase in company directors visiting to comply with new transparency regulations. The Register of Beneficial Owners of Monégasque companies has been quite active, a stark contrast from the previous year when the line of directors waiting to register extended far outside the agency’s doors.
“It’s business as usual today, but last time things were out of control.”
- Well-dressed company director
Frustration Among Directors
The new transparency campaign, aimed at revealing the true owners of companies and eliminating potential frontmen, has left some directors feeling frustrated.
“Now they want to know how we comb our hair in the morning and our shoe size.”
- Director
Monaco’s AML Deficiencies: Moneyval’s Critical Report
Exposing Deficiencies and Shortcomings
In December 2022, Moneyval published a critical report accusing Monaco of numerous deficiencies, weaknesses, and shortcomings, and an “absence of proper risk analysis.”
International Profile and Concerns
Monaco’s international profile, particularly its banking and financial services sector, has made it a top target for suspect financial flows. As a response to the invasion of Ukraine by Russia, Monaco has become a hotspot for concealing ill-gotten assets from Russian oligarchs, with tax fraud, embezzlement, and corruption being significant concerns.
Monaco’s Leadership: Committed to International AML Standards
Following Moneyval’s Recommendations
Monaco’s leadership, led by Head of Government Pierre Dartout, has vowed to follow through on Moneyval’s recommendations and meet the highest international AML standards.
Demonstrating Progress to Avoid “Grey List”
A 12-month observation period began in 2023, during which Monaco must demonstrate tangible progress to the Financial Action Task Force (FATF) to avoid being added to the “grey list” of jurisdictions subject to enhanced surveillance.
Monaco’s International Reputation at Stake
The future of Monaco’s reputation as a respected international financial center hangs in the balance as authorities address lingering criticisms and work to clear the principality’s name.