Financial Crime World

Monaco Urged to Step Up Efforts Against Money Laundering and Terrorism Financing

Strasbourg, January 23, 2023 - The Council of Europe’s anti-money laundering body, MONEYVAL, has called on Monaco to strengthen its measures to combat money laundering (ML) and financing of terrorism (FT), according to a report published today.

Compliance with FATF Recommendations

The report provides a comprehensive assessment of Monaco’s level of compliance with the Financial Action Task Force (FATF) Recommendations as of March 2022. While MONEYVAL acknowledges that Monaco has made some progress, it highlights major improvements are needed in several areas, including:

  • Investigating and prosecuting ML cases
  • Confiscating and recovering proceeds of crime
  • Strengthening its supervisory system

Areas for Improvement

The report finds that Monaco’s transparency of legal persons is a significant concern, as well as TF investigations and prosecutions. MONEYVAL also notes that the country’s threat environment should be further analyzed regarding organized crime and external money laundering threats.

Monegasque Financial Intelligence Unit (SICCFIN)

  • The SICCFIN has been commended for producing high-quality analysis
  • However, this intelligence is not fully used by investigative authorities

Investigations and Prosecutions

  • ML investigations and prosecutions do not appear to be consistent with Monaco’s risk profile
  • Particular shortcomings relating to complex cases

Supervisory System

  • Deficiencies in beneficial ownership checks
  • Lack of understanding of ML/TF risks undermine the authorities’ capacity to apply tailored supervision for obliged entities

Sanctions

  • Limited, not proportionate, and imposed with delays

Private Sector Implementation

  • The number of suspicious transaction reports filed by banks is satisfactory
  • However, the volume of defensive reporting and long transmission times raise questions about the quality of information provided

Reform Progress

Monaco has been commended for reforming its framework enabling the implementation of TF and PF-related TFS under United Nations Security Council Resolutions (UNSCRs). However:

Terrorism Financing

  • There have been no prosecutions or convictions for TF in Monaco
  • The country’s risk analysis is not fully aligned with its risk profile

Follow-Up Procedure

The report concludes by inviting Monaco to report back in December 2024, as part of an enhanced follow-up procedure. MONEYVAL has also decided to apply its enhanced follow-up procedure to ensure that Monaco implements the necessary improvements to strengthen its anti-money laundering and combating the financing of terrorism regime.