Survey related to the fight against money laundering and terrorist financing

The Commission de Surveillance du Secteur Financier (“CSSF”) informs that it will henceforth conduct an annual online survey collecting standardised key information concerning money laundering and terrorist financing risks (“ML/FT risk”) to which the professionals under its supervision are exposed and the implementation of related risk mitigation and targeted financial sanctions measures.

This survey forms part of the AML/CFT risk-based supervision approach put in place by the CSSF over the course of the last years and contributes to the CSSF’s assessment of the money laundering and financing of terrorism risks present in the financial sectors under its supervision.

Indeed, as set out in the “International Standards on Combating Money Laundering and the Financing of Terrorism & Proliferation” (“FATF Recommendations”) adopted in February 2012 by the Financial Action Task Force (“FATF”), notably in Recommendation 1, “countries should identify, assess, and understand the money laundering and terrorist financing risks for the country, and should take action, including designating an authority or mechanism to coordinate actions to assess risks, and apply resources, aimed at ensuring the risks are mitigated effectively. Based on that assessment, countries should apply a risk-based approach (RBA) to ensure that measures to prevent or mitigate money laundering and terrorist financing are commensurate with the risks identified.”

The requirement to assess ML/FT risks and to apply a risk-based supervisory model has been confirmed by the Directive (EU) 2015/849 of 20 May 2015 on the prevention of the use of the financial system for the purposes of money laundering or terrorist financing (“Fourth EU AML/CFT Directive”) and further specified in the European Supervisory Authorities document “Joint Guidelines, on the characteristics of a risk‐based approach to anti‐money laundering and terrorist financing supervision, and the steps to be taken when conducting supervision on a risk‐sensitive basis: The Risk-Based Supervision Guidelines”.

To this end, the CSSF has elaborated new sector specific questionnaires (hereinafter “AML/CFT Questionnaires”) supporting on the one hand, the identification of ML/FT risk factors notably related to clients, countries and geographical areas, delivery or distribution channels, products and services of supervised entities and, on the other hand, the measures put in place to mitigate these risks.

Answers to the AML/CFT Questionnaires are sought from CSSF supervised entities subject to the professional obligations laid down in the Law of 12 November 2004 on the fight against money laundering and terrorist financing, as amended.

They will contribute to the CSSF assessing that preventative and mitigation measures put in place by supervised entities are commensurate with the related ML/FT risks. Moreover, the information and subsequent conclusions drawn from this ongoing exercise will allow the CSSF to inform i.a. the national ML/FT risk assessment.