Financial Crime World

Monaco Faces Scrutiny Over Money Laundering Cases: MONEYVAL Report

Strasbourg, France - The Council of Europe’s anti-money laundering body, MONEYVAL, has issued a report encouraging Monaco to strengthen its efforts in investigating and prosecuting money laundering (ML) cases, confiscating and recovering proceeds of crime, and strengthening its supervisory system.

Monaco Under Evaluation since 2018

Monaco has been under MONEYVAL evaluation since 2018. The latest report emphasizes the need for Monaco to prioritize several areas of improvement mentioned below.

Assessing Risks and Risk Framework

  • Improve assessment of Monaco’s risk assessment framework
  • Address ML risks in real estate and gambling sectors

Supervisory System and Regulatory Framework

  • Enhance the capabilities of the Financial Intelligence Unit (FIU)
  • Improve cooperation with other Financial Intelligence Units (FIUs)

Prosecution and Sanctions

  • Prosecute ML cases effectively
  • Impose adequate, effective, and dissuasive sanctions
  • Address the lack of confiscation orders and slow resolution of ML cases

Historical Scrutiny and International Pressure

Monaco has historically faced criticism and scrutiny over its reputation as a tax haven and money laundering. The latest report comes at a time when international pressure is increasing for small jurisdictions to adhere to stricter anti-money laundering regulations. European countries, including France and Germany, have called for an EU Blacklist featuring countries that do not adequately address ML and terrorist financing risks. Monaco is not an EU member and, therefore, it is not subject to EU regulations.

Government Response and Next Steps

MONEYVAL’s President, Rita Izzo, stated that Monaco was making progress but needed to take further steps to improve its anti-money laundering measures. Monaco’s government has acknowledged the need for action and plans to strengthen the legal framework and improve oversight of financial activities. The next MONEYVAL plenary meeting is scheduled for May 2023, where the assessment of Monaco will be discussed in detail.

Implications for Other Jurisdictions

MONEYVAL’s evaluations play a crucial role in addressing money laundering and terrorist financing risks globally. The outcome of Monaco’s assessment could potentially have significant implications for other jurisdictions with similar challenges.