Luxembourg leads the way in anti-money laundering ‘gatekeepers’ control

Luxembourg came top in a ranking by an international anti-money laundering watchdog that examines the system of so-called “gatekeepers” such as lawyers, accountants and real estate agents.

The Grand Duchy was one of only two countries (along with Portugal) to receive a score of 100% in a review of how the 35 members of the Financial Action Task Force (FATF) apply measures to prevent money laundering and terrorist financing in gatekeeper sectors.

“Luxembourg has introduced requirements covering the following gatekeeper sectors: lawyers and notaries, accountants, TCSPs (trust and company service providers) and real estate agents,” the FATF said in a review published on Monday. “Luxembourg supervisors have all the authority and tools to implement supervisory programs in these gatekeeper sectors.”

Luxembourg’s top score was well above the FATF average of 74%, while three countries – Australia, the US and China – came last with a score of zero.

Seven FATF members scored below 50%. “These jurisdictions account for more than half of global GDP,” the FATF report noted, calling the results “less promising.”

The FATF said oversight of professionals working in the legal, real estate, accounting, and trust and corporate services sectors was necessary because “individuals and firms in these sectors constitute an entry point into the financial system.”

“Guards have specialist knowledge that can be used to facilitate the flow of money and conceal involvement in illegal schemes,” the report reads.

Implementation of 2022 recommendations

Welcoming the report, Justice Minister Elisabeth Margue said that “the FATF once again recognises that the Luxembourg legal framework meets the highest international requirements in the fight against money laundering and terrorism financing,” she said in a statement issued jointly by her ministry and the finance ministry on Tuesday.

The latest FATF inspection comes after the Grand Duchy received high marks in several areas during the global watchdog’s 2022 national inspection.

While Luxembourg was recognised for its technical compliance (i.e. its adherence to the country’s rules) and for its cooperation with international partners during the 2022 inspection, it failed to achieve the highest possible score for the effectiveness of its anti-money laundering measures in any of the 11 areas examined.

Luxembourg’s anti-money laundering law ineffective, FATF says

The FATF has called on Luxembourg to increase funding for government asset recovery agencies and operations aimed at detecting and prosecuting high-profile money laundering cases.

The Ministry of Justice has developed an action plan and set up a working group for each of the seven recommendations in the report, said Catherine Dion-Bourin, head of the Luxembourg FATF delegation. Luxembourg Times in March.

Luxembourg plans new laws to strengthen fight against money laundering

The government plans to hire more judges, speed up court procedures and potentially create an agency to oversee entities outside the financial sector, Dion-Bourin said, in response to the FATF recommendations.

Luxembourg’s fight against financial crime continues to be hampered by a lack of resources, the attorney general and senior prosecutors told a parliamentary committee last week.