Combating abuse

The provision of banking, financial, and insurance services in the Principality of Liechtenstein is subject to approval. The services enumerated in the relevant laws may accordingly not be provided without an appropriate license. Violations are punished by the Court of Justice. The FMA Liechtenstein monitors compliance with these requirements.

For this purpose, the FMA follows up on all indications of activities by non-licensed financial service providers. In particular, the FMA receives relevant reports by individual financial market participants and carries out market observations.

Powers of the FMA Liechtenstein

If there is reason to believe that an activity subject to one of the relevant laws is being pursued without a licence, the FMA may demand information and documents from the persons in question, provided they are subject to supervision by the FMA (see e.g. article 35(5) of the Banking Act, article 53(4) of the IUA).

If the preliminary inquiries substantiate the suspicions, the FMA Liechtenstein refers the fact pattern to the Liechtenstein prosecution authorities.

International cooperation

The strong international links of the Liechtenstein financial centre also require close international cooperation to effectively prosecute cross-border services provided without the required licences. The relevant European directives create far-reaching opportunities for financial service providers to operate across borders using a "European passport". In return, this necessitates that unapproved activities be prevented effectively through the cooperation of the competent EEA authorities.

A new challenge for supervision is posed especially by the financial services offered by way of distance selling (especially via the Internet).

Prevention

To counter abusive activities preventively, the FMA is always available for consultation regarding the clarification of licensing conditions even before business activities are taken up. In this connection, please refer to the list of problematic company names and declarations of purpose, in which problematic terms and formulations for company names and purposes are enumerated, the registration of which requires more detailed clarifications on the part of the FMA Liechtenstein.

Potential clients have the possibility of obtaining information about licences held by contractual partners before concluding a business transaction by consulting the register maintained by the FMA. Here again, the FMA will provide information on any applicable licensing requirements.

The work performed by the FMA to combat abuse thus makes a significant contribution to securing confidence in the Liechtenstein financial centre and is of vital importance to the international reputation thereof.

 

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