Financial Crime World

Title: MONEYVAL Report: Liechtenstein’s Anti-Money Laundering Measures Get a Thumbs-Up, Room for Improvement Remains

Introduction

The European Money ValIDation (MONEYVAL) Committee of Experts has released its fifth round evaluation report on Liechtenstein’s efforts to combat money laundering (ML) and terrorist financing (CTF). In this article, we provide an overview of the report, highlighting the key findings and recommendations.

Location and Dedication

  • Nestled in the heart of Central Europe’s Alpine region
  • Small financial center with a proactive stance towards ML/CTF risks
  • Clear commitment to combating financial crimes
  • Implemented numerous policies and fostered international partnerships

Key Findings: MONEYVAL’s Assessment

Risk Assessment

  • Thorough risk assessments conducted
  • Broad understanding of ML/CTF threats
  • Need to refine methods for identifying risks related to tax offenses, use of financial services, and non-bankable assets held by trust and company service providers (TCSPs)
  • Sound legal framework
  • Automatically implements UN Security Council Resolutions
  • Criminalizes failure to report suspicious transactions
  • Employs non-conviction-based confiscation
  • Improvements necessary in the area of sanctions

Financial Intelligence Unit (FIU)

  • High-quality analytical reports and support to law enforcement agencies in ML investigations
  • Confronted with a mounting workload
  • Need for additional resources and strategic analysis in areas such as TF, money laundering of proceeds of foreign tax crimes, and SAR/STR reporting

Investigation and Prosecution

  • Secures convictions for various ML offenses
  • Effective collaboration among agencies
  • Financial investigations commonly utilized
  • Dearth of investigations targeting intricate ML schemes involving convoluted legal structures

Confiscation and Asset Forfeiture

  • Seizure and confiscation prioritized and legal framework comprehensive
  • Capacity strengthening critical for enhancing effectiveness of measures
  • Outcome of confiscation proceedings generally aligns with Liechtenstein’s risk profile

Cooperation with Neighboring Countries

  • Closely collaborating with Switzerland and Austria
  • Skills and knowledge enable detection of funds intended for TF purposes
  • No TF investigations or convictions within the country

Recommendations

To strengthen its AML/CTF system, MONEYVAL offers the following recommendations:

  • Improvements in risk assessment methodology
  • Targeted financial sanctions
  • Transparency and beneficial ownership of legal persons and legal arrangements

Conclusion

Implementing these recommendations will enable Liechtenstein to solidify its standing as a reputable international financial center and continue its efforts in combating financial crimes.