Financial Crime World

Liechtenstein Tightens Noose on Financial Crime, Complies with International Standards

In its ongoing quest to combat financial crime and terrorism financing, Liechtenstein has implemented robust measures to prevent money laundering and terrorist financing. The principality’s zero-tolerance policy in this regard has earned it a positive review from the Financial Action Task Force (FATF), which praised Liechtenstein’s strong supervisory approach and its ability to identify and mitigate risks.

Compliance with International Standards

As an EU Economic Area (EEA) member, Liechtenstein has implemented the 4th and 5th EU Anti-Money Laundering Directives as well as Regulation (EU) 2015/847 on information accompanying transfers of funds. The country’s anti-money laundering (AML) and combating the financing of terrorism (CFT) regime is based on a range of legislative and regulatory measures, including:

  • Law on Professional Due Diligence for the Prevention of Money Laundering, Organised Crime and Financing of Terrorism (Due Diligence Act; SPG)
  • Ordinance on Professional Due Diligence for the Prevention of Money Laundering, Organised Crime and Financing of Terrorism (Due Diligence Ordinance; SPV)
  • Act on the Register of Beneficial Owners of Legal Entities (VwbPG)

AML/CFT Requirements

Financial institutions, trust service providers, and designated non-financial businesses and professions (DNFBPs) are subject to AML/CFT requirements, which include:

  • Identifying and verifying clients, beneficial owners, and source of funds and wealth
  • Conducting ongoing transaction monitoring
  • Reporting suspicious transactions

Financial Intelligence Unit

The Financial Intelligence Unit (FIU) is responsible for receiving and analyzing reports of suspicion from persons subject to due diligence and public authorities. If it suspects a criminal offence has been committed, the FIU reports to the Office of the Public Prosecutor.

Praises from MONEYVAL and FATF

Liechtenstein’s AML/CFT regime has been praised by MONEYVAL, an FATF-style regional body, which acknowledged the country’s progress in improving its measures to combat money laundering and terrorist financing. In its fifth report on Liechtenstein, MONEYVAL noted that the country had a broad and convergent understanding of its money laundering and terrorist financing risks and pursued a strong supervisory approach commensurate with those risks.

Additionally, Liechtenstein has been rated “compliant” or “largely compliant” with 37 of the 40 FATF Recommendations. The country scored above average in five of 11 “immediate outcomes” examined, and MONEYVAL did not identify any significant gaps in its AML/CFT measures in other areas.

International Cooperation

In addition to its domestic efforts, Liechtenstein is also committed to cooperation at the European level, participating in the EU’s anti-money laundering and combating the financing of terrorism (AML/CFT) framework. The country has centralised its AML/CFT responsibilities relating to the financial market at the European Banking Authority (EBA), where it represents as a non-voting member of the AML CFT Standing Committee.