The small principality of Liechtenstein, already plagued by money-laundering allegations and investigations, suffered a further blow last week when a bank owned by the family of Liechtenstein's ruling Prince Hans-Adam II was raided by agents seeking out alleged money laundering, with police seizing documents and electronic files held by the Liechtenstein Global Trust Bank (LGT Bank).
The police have been investigating money laundering allegations since the beginning of the year and already eight top-level individuals have been arrested. This latest search was ordered because of suspicions that these financial managers used the bank for illegal transactions running into tens of millions of dollars. The alleged illegal transactions involved a large number of both Liechtenstein and foreign firms.
LGT Bank is one of Liechtenstein's main banks, which makes investigations into it even harder to swallow for those out to combat money laundering. The bank's administrative council president is Prince Philipp, who is the brother of the ruling Prince Hans-Adam II.
According to German ZDF Television, police in Liechtenstein said that as yet they had found nothing to suggest anything was amiss with the bank itself, but that the purpose of the raid was to get at various accounts in the bank. Bank officials confirmed that the search was not directed either at the bank or its employees. The German television report said police investigations found that foreign and local businesses had co-operated with suspected money-launderers in order to open accounts at the bank.
The raid on LGT Bank came in the same week that Liechtenstein Foreign Minister Andrea Willi visited Washington with the aim of keeping the principality off an international blacklist, to be published by the Financial Action Task Force on Money Laundering at the end of June.
The country has been heavily criticised for its banking secrecy laws and for apparently being "uncooperative" in the fight against money laundering. Last year, a German government report accused banks in Liechtenstein of recycling money from South American drugs cartels and stated that "vast hundreds of millions of illegal dollars went through the country". Furthermore, a French National Assembly report shows Europe is still wary of Liechtenstein, describing it as the "the most dangerous tax haven in Europe."
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