Financial Crime World

Money Laundering Crimes and Reporting Requirements in Liechtenstein: A Media Overview

In the tiny European country of Liechtenstein, the issue of money laundering has gained significant attention as financial institutions and other businesses grapple with stringent reporting requirements aimed at preventing such illicit activities. This article explores the legal framework and regulatory landscape surrounding money laundering in this picturesque Alpine state.

1.1 The Crimes of Money Laundering and Criminal Enforcement

In Liechtenstein, the prosecution of money laundering falls under the jurisdiction of the national public prosecutor’s office. Establishing and proving money laundering involves specific requirements under the Liechtenstein Criminal Code (StGB).

  • Money laundering crimes: Money laundering can be committed with respect to assets originating from criminal offenses (§ 165 para. 1 and para. 2). The government must prove that the offender committed a punishable act with respect to the assets under question and that these assets originated from a predicate offense.
  • Extraterritorial jurisdiction: Jurisdiction exists for money laundering involving assets that originate from foreign criminal offenses, as long as these assets enter or pass through Liechtenstein.

1.2 Responsible Authorities

  • Public Prosecutor’s Office: The public prosecutor’s office bears the main responsibility for investigating and prosecuting money laundering cases. They can instruct the police to conduct investigations, and the police may also act autonomously if they suspect the involvement of a serious or high-profile offense.
  • Corporate Criminal Liability: The StGB acknowledges corporate criminal liability, with the legal entity responsible for any unlawful and culpable misdemeanors or crimes committed in the course of business activities.

1.3 Maximum Penalties

Penalties for money laundering depend on the specific act committed and the value of the assets involved (source: StGB).

1.4 Statute of Limitations

Money laundering crimes generally have a five-year statute of limitations, but can be extended to ten years if the value of the laundered assets exceeds CHF 75,000, or if the crime was committed as part of a criminal organization.

2. Anti-Money Laundering Regulatory Requirements and Enforcement

The Liechtenstein legislative authority, comprising of the Due Diligence Act (SPG) and the Due Diligence Ordinance (SPV), oversees the enforcement of anti-money laundering (AML) regulations in Liechtenstein. Two main authorities, the Financial Market Authority (FMA) and the Financial Intelligence Unit (FIU), are charged with ensuring AML compliance among financial institutions and other businesses.

2.2 Self-Regulatory Organizations

The Liechtenstein Bankers Association has issued guidelines to help banks deal with foreign correspondent banks, ensuring their customers’ tax compliance, and managing risk factors in the money laundering sector (source: The Liechtenstein Bankers Association).

2.4 Financial Intelligence Unit

The FIU analyzes suspicious transaction reports received from financial institutions and other businesses subject to AML obligations (DDOs). Suspicions of money laundering, predicate offenses, organized crime, or terrorist financing should be reported to the Liechtenstein public prosecutor’s office.

3. Anti-Money Laundering Requirements for Financial Institutions and Other Designated Businesses

3.1 Targeted Sectors

Various financial institutions and non-financial businesses must comply with anti-money laundering requirements, such as banks, investment firms, e-money businesses, asset management companies, providers of certain services for legal entities, and real estate agents, among others.

3.2 Reporting Thresholds

Financial transactions involving cash payments or crypto-assets with a value above CHF 10,000 are subject to reporting requirements. TT service providers engaged in crypto-asset transactions must also adhere to stringent due diligence obligations.

3.3 Risk-Based Approaches

Financial institutions and other businesses subject to anti-money laundering requirements must maintain a risk-based approach to detect and prevent suspicious activities, including:

  • Regular monitoring of business relationships
  • Customer identification and verification
  • Ongoing assessments of the risk profile

Understanding the legal, regulatory, and enforcement frameworks in Liechtenstein can help financial institutions and other businesses effectively implement the necessary measures and comply with anti-money laundering requirements.