Title: MONEYVAL Report: Monaco Needs to Bolster Anti-Money Laundering Measures, Particularly in Casinos and Company Services Sector

Monaco’s Moderate Rating in Latest MONEYVAL Evaluation

On 23 January 2023, MONEYVAL published its evaluation report on Monaco’s progress in preventing and combating money laundering (ML) and terrorism financing (TF) activities. The principality received a moderate rating, indicating the need to strengthen its efforts in these areas.

Assessment Focus and Key Areas for Improvement

An onsite visit was conducted in March 2022 to assess Monaco’s ability to effectively combat ML and TF. The report highlighted several areas where improvement is necessary, including:

1. Resource constraints at SICCFIN: A significant lack of human and technical resources has hindered the Financial Intelligence Unit’s investigations and prosecutions.
2. Addressing ML risks in various sectors: Monaco needs to address ML risks in sectors such as casinos, company services providers, trusts, virtual assets, and organized crime.

Improving the Supervisory System and Addressing ML Cases

The report emphasized the following points regarding improving Monaco’s system:

• Beneficial ownership: Monaco’s supervisory system needs improvement, particularly in relation to beneficial ownership.
• Identifying and prioritizing ML cases: Monaco must make more progress in identifying and prioritizing ML cases, and effectively seizing, confiscating, and recovering proceeds of ML and predicate offenses.

Progress and Challenges in the Private Sector and Implementation of UN Targeted Financial Sanctions

In the private sector, some progress has been made in implementing ML/CFT obligations, but regulatory shortcomings remain. Monaco has encountered challenges in implementing United Nations targeted financial sanctions on TF and proliferation financing effectively due to delays in implementing designations.

Lack of Convictions or Prosecutions for TF

Concerns were raised regarding Monaco’s lack of convictions or prosecutions for TF, potentially due to deficiencies in TF risk analysis.

International Cooperation and Necessary Steps for Monaco

Effective international cooperation is essential to addressing ML and TF threats, and Monaco generally seeks the cooperation of counterparts. However, legislative obstacles hinder its provision of mutual legal assistance.

Conclusion: Bolstering Anti-Money Laundering Measures

The challenges outlined in the report demonstrate the need for Monaco to bolster its anti-money laundering measures, particularly in sectors vulnerable to ML risks, such as casinos and company services providers. Implementing the recommendations from the report necessitates addressing resource constraints, identifying and addressing ML risks, and improving the supervisory system and investigative procedures.