Luxembourg is set to undergo another anti-money laundering review by the Financial Action Task Force (FATF). Last time FATF found the Duchy to be fully compliant with only one out of 40 indicators.
The FATF in 2010 gave Luxembourg an average score of three in its assessment, on a scale of one – being the best – to four. Out of 40 indicators, Luxembourg was fully compliant with only one and largely compliant with another nine.
The task force found non-compliance in seven cases, while Luxembourg was partially compliant on 23 of the indicators, the Luxembourg Timesreports.
Financial Action Task Force is a global body for anti-money laundering and combating the financing of terrorism.
A poor ranking by the FATF could have negative implications for the financial sector, as Luxembourg would be considered a high-risk country.
Among the actions already taken, the Justice and Finance Ministries set up a committee on the prevention of money laundering and the financing of terrorism, which includes 26 players including the government, financial sector regulator CSSF, the Chamber of Commerce, the Chamber of Notaries and the customs administration.
The minister said that Luxembourg being among the early movers to implement an EU directive and introduce a beneficial owners register for companies doing business in Luxembourg would also be seen as a good sign.
The European Commission in November 2018 referred Luxembourg to the European Court of Justice over failure to fully transpose the fourth Anti-Money Laundering Directive by a June 2017 deadline, the local news outlet reports.