Money-Laundering

Luxembourg updates its national assessment of money laundering and terrorist financing risks

15/12/2020

Luxembourg has just finalised the update of its National Risk Assessment on Money Laundering and Terrorist Financing (ENR 2020). The ENR 2002 was conducted under the direction of the Ministry of Justice and adopted on 15 September 2020 by the Money Laundering and Terrorist Financing Prevention Committee (BC/FT Prevention Committee).

 

Financial crime is a destabilizing factor in economies and damages the integrity and reputation of the financial sector.

Money laundering and terrorist financing are two of the main components of financial crime.

Money laundering involves putting back into the legal system capital whose origin is illegal or even criminal, such as organized crime, trafficking in narcotics, weapons, works of art, the exploitation of prostitution, aggravated tax evasion.....

Terrorist financing is the purpose of providing or raising funds with the intention of having them used or knowing that they will be used to commit or attempt to commit acts of terrorism.

The amended Anti-Money Laundering and Financing Act of 12 November 2004 lists and details the anti-money laundering/terrorist financing obligations of professionals.

With regard to insurance, life insurance and credit/guarantee activities are covered by the aforementioned law. Professionals practising these branches of insurance are thus subject to strict professional obligations, especially in terms of knowledge and identification of their clients as well as constant vigilance throughout the business relationship. Failure to do so can result in heavy financial penalties and even criminal penalties.

Under its legal mission, it is the responsibility of the Office of the Insurance Commissioner (caa.lu), the supervisory authority of the insurance sector, to ensure compliance with professional obligations in the fight against money laundering and the financing of terrorism by all individuals and corporations under its supervision.

The Financial Intelligence Unit (FRC) is part of the Luxembourg Economic and Financial Prosecutor's Office. Its mission is to receive statements of suspicion from professionals in the area of money laundering and terrorist financing, to analyse them and to pass them on, if necessary, to the prosecuting authorities.

The ACA's "AML" Working Group, which groups all insurance/reinsurance companies subject to the law on money laundering and terrorist financing, addresses all issues and themes relating to money laundering and terrorist financing. It also develops "best practices" in the fight against money laundering and the financing of terrorism. In particular, it has drawn up a list of potential indicators of suspicion under the primary offence of laundering aggravated tax evasion or tax evasion. This list is published on our website.