What did the Financial Action Task Force (FATF) say about Luxembourg in 2023 as part of the fourth round of evaluations? It noted the ‘significant’ progress made since 2018 in the fight against money laundering, particularly with the creation of the Register of Beneficial Owners (RBE). However, it also highlighted a number of weaknesses.
Between progress and shortcomings
Firstly, the lack of police and judicial personnel dedicated to financial crime, “a worrying mismatch between the resources available and the country’s risk profile”. Secondly, the length of time taken to bring proceedings, which is considered too long – an average of 18 months between the end of an investigation and the start of proceedings.
The FATF also noted shortcomings in the supervision of non-financial sectors – notably business service providers and estate agents. In these sectors, the volume of suspicious transaction reports remains ‘very low’, largely due to operators’ limited understanding of their obligations. The FATF also highlighted the uneven application of preventive measures and supervision. Unlike in the banking sector, the risk-based supervisory approach is still in its infancy for non-financial professions and virtual asset service providers.
The financial regulator has finally highlighted certain institutional and legal shortcomings. For example, the fact that penalties for breaches of beneficial ownership disclosure obligations are exclusively criminal in nature. “This limits their speed, proportionality and effectiveness.”
Information and prevention
Since then, Luxembourg has been working to continuously improve its anti-money laundering and counter-terrorist financing system, according to the Ministry of Justice. “A national strategy has been adopted for 2025–2026; an update to the money laundering risk assessment was published in May 2025; an update to the terrorist financing risk assessment is due to be published in principle by July at the latest, along with an initial assessment of proliferation financing risks. These publications meet the objectives set by the FATF and aim to improve stakeholders’ understanding of the risks to which Luxembourg is exposed,” explains the Ministry of Justice, the competent authority in this area. The “Combating Money Laundering and Terrorist Financing” Directorate is a department within the Ministry. It represents Luxembourg at the FATF and participates in its work.
The ministry also launched on 6 May a national portal dedicated to combating money laundering and terrorist financing amlcft.public.lu. A portal presented at the meeting of the Committee on the Prevention of Money Laundering and Terrorist Financing, attended by 
Eight bills before MPs
On the legislative front, various bills have been introduced into the legislative process. Some have already been passed, notably the Act of 12 December 2025, which broadens the scope of primary money laundering offences and speeds up proceedings, in particular through a system of summary investigations.
Other bills are either being introduced or are currently being drafted. Specifically, these are the following parliamentary bills:
- Bill 8579 of 11 July 2025 transposing into national law provisions relating to the definitions of criminal offences connected with the violation of restrictive measures, as well as the associated criminal penalties. The draft provides for the creation of a new committee for coordination and cooperation on restrictive measures, responsible in particular for ensuring coordination and cooperation between law enforcement authorities and the authorities responsible for implementing restrictive measures.
- Bill 8680 of 7 January 2026, which aims to introduce a digital identifier to simplify administrative procedures and interactions with public authorities.
- Bill 8679 of 7 January 2026 aimed at combating illegal gambling in places accessible to the public and in private premises open to the public, primarily cafés.
- Bill 8695 of 29 January 2026 aimed at strengthening the national governance and coordination framework for combating money laundering and terrorist financing in accordance with Directive 2024/1640.
- Bill 8698 of 2 February 2026 establishing minimum rules on the tracing, identification, freezing, confiscation and management of assets of illicit origin. This draft also provides for improving the efficiency of the management of seized and confiscated assets, the introduction of the confiscation of unexplained wealth, and the merger of the Asset Recovery Office (BRA), currently attached to the Luxembourg Economic Prosecutor’s Office, and the Asset Management Office, under a single umbrella, which would become the Asset Management and Recovery Office (BGRA).
- Bill 8704 of 11 February 2024 establishing an additional division within the Court of Appeal and creating five new judicial posts (a division president, a senior judge and a judge at the Court of Appeal, and a senior advocate general and an advocate general within the Public Prosecutor’s Office).
- Bill 8705 of 13 February 2026, the purpose of which is to establish channels of communication between the CAA, the CSSF and the Public Prosecutor’s Office where there is a risk of double jeopardy.
- Bill 8722 of 20 March, aimed at providing the Financial Intelligence Unit (FIU) with a legal basis enabling it to share relevant information with designated professionals subject to anti-money laundering and counter-terrorist financing obligations.
The next on-site visit by the FATF is scheduled for 2030. In the meantime, MPs have their work cut out for them.
