Page 52 - Monaco Economy 131

UPDATE

laundering and terrorist financing, as well as
the requirements for declarations of base and
beneficial owners; increase the resources of its
financial intelligence unit, as well as the quality
and speed of the processing of suspicious
transaction reports.”
To improve the effectiveness of its judicial
system, Monaco must also "increase
the number of judges, impose effective,
© Direction de la Communication money laundering, and develop the seizure
dissuasive and proportionate sanctions for

of assets suspected of originating from
criminal activities". "Several emblematic
Pierre Dartout, Ministre d’État / Minister of State cases are underway. I hope to see a number
of convictions for money laundering in the
has made us aware of them. In five years' Monegasque authorities find it difficult to coming months, even though the justice
time, we will look back on this period as a anticipate the reactions of foreign financial system does not move at the same pace
time when Monaco turned a corner..." added regulators and banks at this stage: "In the past, as the economy," adds Public Prosecutor
Pierre-André Chiappori, who believes that the countries on the grey list have been treated Stéphane Thibault. Especially as "for these
harmful consequences of this stigmatisation severely by regulators, and benignly by others, very voluminous financial cases, there is a
on the Monegasque economy should be even though their classification was the same. risk of appeal and decisions by the Court of
limited. "There could be an influence on growth "No matter how long this period lasts, we will Revision. This may take some time...". As for
if we were to have this status for five years, have to learn to live with a number of cogs in seizures by examining judges, in 2023 they
but being put on the grey list for a year and a the wheel that are more seized up than before, reached around 200 million euros, while the
half in the short term has virtually no impact. due to the need for greater documentation of current stock represents half a billion euros.
Especially for a country that doesn't borrow many of our economic operations" fatalistically "The FATF is asking for seizures that are
and has a negative debt thanks to our reserve sums up Councillor Régis Bergonzi. provisional to be transformed into definitive
fund." Will Monegasque oil and real estate be confiscations. This is a matter for the courts.
affected? Will this new situation push residents Is the plan to exit the list in January 2026 We have already significantly increased the
or investors to leave the country or change too ambitious? number of convictions for money laundering
their business centres?" Monaco remains a In concrete terms, what does Monaco have to last year: around ten in 2023 compared with 2
very attractive territory, there will always be do to come off the FATF's grey list in January in 2022". Following legislative innovations such
people coming to Monaco to invest or to live. 2026 (with two intermediate milestones in May as the presumption of money laundering, which
The fundamentals of the economy are solid", and September 2025)? The global anti-money facilitates prosecution in the case of opaque
reassures Pierre Dartout, who met with local laundering watchdog acknowledges that a financial circuits, much is now expected of
business representatives (Economic, Social great deal has been achieved, including the the new Department for Managing Seized and
and Environmental Council (ESEC) Fedem, establishment of a new Financial Intelligence Confiscated Assets. The recruitment of nine
etc.) to discuss this hot topic. Unit (FIU) and a combined AML/CFT people has been agreed for three different
However, some bankers saw capital flows to supervisor, the strengthening of the detection budgets up to 2025.
other countries such as Luxembourg on the and investigation of terrorist financing, the As far as human resources are concerned,
very day of the FATF's announcement, and implementation of targeted financial sanctions it is not easy to increase the number of
we already know that transactions will be and risk-based supervision of non-profit Monegasque judges at a time when France
slowed down because of the strict application organisations. "80% of the shortcomings is struggling to recruit its own... At present,
of compliance. "De-risking" is a phenomenon identified by Moneyval were resolved even two thirds of the judges working in Monaco
in which foreign financial institutions before we went to Istanbul for our face-to-face are already on secondment from France, that's
distance themselves from counterparties, meeting with the FATF group and before the 19 out of 27. To avoid going through the ENM
correspondent banks, customers and countries plenary session in Singapore", notes Pierre- (National School for the Judiciary) and the
considered to present high risks in terms of André Chiappori, who estimates that only 20% secondment mechanism, the Monegasque
money laundering or terrorist financing... The of the work remains to be done. authorities are looking at alternative solutions:
high cost of compliance, the reputational Monaco has pledged to follow the FATF's hiring “newly retired” judges to help out on an
risks and the complexity of transactions action plan and still needs to "strengthen ad hoc basis, as well as drawing on the local
are all factors that are pushing financial understanding of the risks of laundering tax pool of legal professionals. This will require
institutions to avoid dealing with countries fraud committed abroad, increase requests legislation. "Elected representatives will
deemed to be at risk", notes a study by Phoenix to third countries to identify and seize continue to deploy the energy necessary if
Consulting Monaco, listing a fall in GDP or financial assets of criminal origin abroad, additional resources are required to implement
foreign investment among the major risks and ensure that sanctions are imposed for the recommendations made", the National
(see Monaco Economie N°129). However, non-compliance with the rules on money Council advised.

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