Financial Crime World

Monaco Tightens Financial Crime Sentencing Guidelines

In a bid to strengthen its stance against money laundering, terrorism financing, and weapons proliferation, Monaco has published a new law aimed at adapting its legislative provisions on these issues.

New Law Introduces Significant Changes

Law No. 1.559 of February 29th comes into effect this month, introducing significant changes to the country’s financial crime sentencing guidelines. The law introduces stricter regulations and penalties for non-compliance, particularly for trustees who manage trusts set up or transferred to Monaco.

Stricter Regulations for Trustees

  • The new law introduces a new concept of domicile, alongside residency, to determine whether a local representative is required for trust management.
  • The representative will be held to the same legal obligations as the trustee itself.

Extended Retention Period and Storage Requirements

  • The retention period for information and related documents has been extended from five to ten years.
  • Trustees are required to store this data in premises located within Monaco.
  • The address of these storage facilities must be communicated to the Department of Economic Development (DDE).

Increased Administrative Monetary Penalties

  • Fines have been increased to deter non-compliance, ranging from €5,000 to €100,000 for repeated offenses.
  • Criminal penalties, including imprisonment and fines, apply if the breach persists.

New Criminal Qualification for Disclosure of Information

  • The law introduces a criminal qualification for disclosure of information to clients by professionals who receive requests from authorities.
  • Failure to comply with this requirement can result in a fine ranging from €18,000 to €90,000 and up to two years’ imprisonment.

A Step Forward in Combating Financial Crime

The move is seen as a significant step forward in Monaco’s efforts to combat financial crime and bring its legislation into line with international recommendations. The country’s legal experts at A.L.F.A. MONACO are available to provide guidance and support to individuals and businesses affected by the new law.