Monaco's Regulatory System Gets Thumbs Up From IMF

by Ulrika Lomas, for LawAndTax-News.com, Brussels

16 September 2003

The International Monetary Fund's (IMF) recently published assessment of Monaco's financial supervisory and regulatory regimes has confirmed the Principality's reputation as a well regulated jurisdiction.

In its report, released late last month, the IMF observed that:

'The Principality of Monaco has in place a comprehensive legal framework, supervisory structure, and practices that support a well regulated financial environment.'

It went on to add that: 'The authorities have over the past two years adopted a strongly proactive approach to supervision, especially in the AML/CFT area. This emphasis is appropriate to a system largely dominated by internationally active private banking and related financial services, the supervision of which benefits from close collaboration with the French supervisory authorities,' and concluded by suggesting that:

'Monaco's proactive stance, crucial to reducing the potential for reputational risk, could be enhanced by further developing the cooperation, additions to the AML/CFT regime, and some fine-tuning of supervisory arrangements.'

Recommendations made by the multilateral body included the speedy completion of negotiations on the Memorandum of Understanding (MOU) currently under discussion by the Monegasque Financial Intelligence Unit and the French Banking Commission, the intensification of work on MOUs with other foreign supervisory authorities, and increased due diligence for higher risk customers, including politically exposed figures and their associates.

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