AML/CFT
Luxembourg establishes ML/TF Prevention Committee: Composition and Functioning Defined
On 11 June 2025, a Grand-Ducal Regulation was adopted establishing the composition and functioning of the Committee on the Prevention of Money Laundering and Terrorist Financing (ML/TF Prevention Committee).
The ML/TF Prevention Committee includes representatives from public and private sectors, such as ministries (Justice, Finance, Internal Security, Foreign Affairs), supervisory authorities (Luxembourg supervisory authority for financial services (Commission de Surveillance du Secteur Financier – CSSF), Commissariat aux Assurances), legal professions (lawyers, notaries), finance and accounting professionals, prosecutors, judges, police, customs, and trade and beneficial ownership registries. Members and their alternates are appointed by the Minister for renewable five-year terms, with alternates stepping in as needed.
It will be chaired by the Minister or, in their absence, the National Coordinator and must convene at least twice yearly. Decisions are made by consensus. An executive secretariat supports its work, and dedicated working groups may be established for specific tasks or particular issues. Members are required to maintain confidentiality, avoid conflicts of interest and disclose any conflicts or breaches.
EBA issues Opinion on ML/TF risks in the EU financial sector
On 28 July 2025, the EBA published its fifth opinion and report on money laundering and terrorist financing (ML/TF) risks, covering the period from 2022 to 2024. In addition to evolving risks linked to CASPs, the report highlights weaknesses in governance and compliance frameworks. Key vulnerabilities include exposure to cybercrime, outsourcing without effective oversight and inadequate customer due diligence controls.
The EBA notes that CASPs and FinTech firms remain particularly exposed, with some prioritising rapid growth over robust and effective AML/CFT controls. AML/CFT RegTech tools, while offering potential, are often poorly tailored, inadequately overseen, or create outsourcing risks. Other areas of concern include increased use of stablecoins in terrorist financing, persistent risks around politically exposed persons, and weaknesses in sanctions compliance and transaction monitoring. Fraud and cybercrime are also rising, driven by digital onboarding, AI and deepfakes.
The EBA calls on competent authorities to ensure supervisory priorities reflect these risks and urges firms to strengthen governance, customer due diligence, risk assessments and monitoring frameworks, particularly in innovative or fast-growing sectors.
CSSF updates eDesk procedure for AML/CFT Market Entry Form
On 30 September 2025, the CSSF announced updates to the eDesk procedure for completing the AML/CFT Market Entry Form for investment funds and IFMs. The changes remove the sections relating to “Portfolio Manager(s)” and “Investment Advisor(s)” for both authorised and registered IFMs, reflecting the CSSF’s effort to simplify the form and avoid redundant information. These sections have been automatically deleted from all forms that were in draft or reopened status at the time of the update.
The CSSF further reminded entities to comply with existing AML/CFT requirements regarding the submission of the Market Entry Form. Additionally, the CSSF advised that forms which have been in draft status for more than one year should be reviewed, either be completed and submitted or deleted, to maintain accurate records within the eDesk platform.
CSSF publishes its FAQ on international financial sanctions
On 30 September 2025, the CSSF published answers to frequently asked questions with respect to international financial sanctions. Entities that have questions on whether they are subject to reporting obligations or how international sanctions relate to the fight against terrorist financing, to give a few examples, may find the answers in the FAQ-document.